I LIBRARY OF CONGRESS.? 



I — ^ ^M4 I 

I UNITED STATES OF ASLeViOA, J 



A PRACTICAL SYSTEM 



FOB THE 




ALE OF 



ATENT lilGHTS 



FOR THE USE OF 



INVENTORS AND PATENT OWNERS, 



ENABLIl?^ THEM TO 



DISPOSE OF THEIR OWN PATENTS 



With Certainty, Safety and Profit 



WITH OTHEB 



Valuable Information for Inventors. 



SECOND EM^ION. 
BY CHAS, B. MANN. 



PUBLISHED BY 

S, S. MANN & CO. 

BALTIMORE, MD. 

1875, 



^ ^ ccpv: 



Entered according to the Act of Congress, in the year 1875, by 
Chas. B. Mann, in the Office of the Librarian of Congress, at Wash- 
ington, D. C. 



^^ 



3> 






\^^A^ 



\ 



THE SUN 

BOOK AND JOB PRINTING ESTABLISHMENT, 

Sun Iron Building, 
Baltimore, Md 



CONTENTS, 



About this Volume 7 

The FmsT Thing to be Done 9 

An important matter 9 

Patents of which Territorial Rights may be sold 9 

Patents which, in general, bet er be let on Royalty 10 

Royalty 12 

How to fix the rate of Royalty.. 12 

An important reminder to Inventors about making a License 

Contract with a Manufacturer 12 

Valuable suggestions 13 

Stipulations and conditions to insert in a contract with Manu- 
facturers 13 

A good form for License Contract for Royalty U 

Shop Rights. IT 

Restrictions to place on them 17 

Form for Shop Right License 13 

To ASCEETAIN the VaLUE OF A PATENT 19 

A proper view of this matter 20 

The Price of Tekeitorial Rights 22 

How to figure it 23 

Scale to fix the price of Rights 24 

How TO Proceed 20 

Some practical advice 26 

Preparations that are important to an Inventor 27 

Paving the way for sales 27 

How to obtain the names of Manutacturers of any aiticle 23 

Business methods and common sense 29 

Timely advice in this connection 29 

About writing letters What will suflace to awaken interest. .29 
The way to approach Manufacturers 30 

Exceptional Inventions 31 

Threeclasses and special plans for each 31 

1st class embraces such as Musical Instruments, Fire-Proof 
Safes, Ships Tackle, Reapers and Mowers, Sewing MachinesSl 

24 class, Railway Improvements 31 

8d class. Street Letter Boxes, Fire Plugs, everything relating 

to City, State, or National Government use 32 

How to manage them successfully and profitably 32 

Some really practical plans, ensuring almost certain success.. 32 

How to sell Railroad Inventions 33 

A caution , 34 

Selling Rights to Public Authorities 35 

A chapter of practical suggestions 36 



Selling Teeeitoktal Eights 40 

The experience of Inventors who have been successful in this 

"business 40 

Traveling salesmen 41 

Difficulties ...-41 

How tliis system avoids many of the difficulties 42 

A new and valuable feature to be employed in selling 43 

Improved form for Power of Attorney 44 

Expl anation of same 46 

Improved form for Patent Deed 48 

Explanation of same 50 

A Safe PLA>r to Sell Patents on Ceedit 51 

Taking Notes in payment for Bights 51 

No risk by this me'hod 51 

Best form of Note 52 

Improved form of Contract (original with this system) 53 

Explanation of same 55 

To secure good Agents 57 

Commission to allow Traveling Agents .57 

How a new Agent should begin 57 

Wl^ at is r ecessarv 58 

Explicit instructions 58 

A good idea about "Letters of Recommendation." 58 

How to make them effective with strangers 58 

Finding a Purchaser , 59 

Suggestions that will save money for Inventors 59 

Instruction and advice to the point 60 

Directions for further proceeding GO 

How to offer a Patent. What to avoid 61 

A sure way to interest a man in a new invention , . .62 

Now is the time 62 

A very important matter. A reminder that may prevent 

failure 62 

A party considering the purch se of a Patent may be distrust- 
ful and yet not express objection. How to manage such 

cases to the best advantage 62 

How to gain the confidence of strangers to whom a Patent is 

offered 63 

By this System buyers can be easily satisfied that their Rights 

will be protected .63 

ComiDg down to business 64 

Closing a trade 64 

Negotiations oe Sales are sometimes Defeated 65 

The way to prevent this .66 

Some suggestions 67 

Joint Stock Companies 68 

About the formation of. 68 

Form for Articles of Association 69 

The legal proceedure 70 



IntpvOdtjcing New Inventions — 71 

Small articles 71 

A plan possessing advantages Vi 

"Why new articles of merit fail of success 7Z 

Joint Owneeship of Patents 74 

Undivided Interests 74 

Some misconception cleared up 74 

Every Inventor should understand this 74 

Joint owners are not co-partners 75 

The law on the subj ect .75 

The interest of each part owner should be protected 76 

Several plans to this end — .7(5 

Improved form for Assgnment of Undivided Interest 77 

Form of Agreement between owners of a Patent. 73 

Pkiority of Invention 82 

Plan for establishing same 82 

Law of Priority 83 

Agents for the Sale of Patents 84 

A caution 84 

The truth about these Agents 85 

The almost universal experience 85 

All about Licenses 87 

State Laws affecting Patents 87 

A sound legal view 87 

Every Patent Owner should understand this 87 

Judicial decisions on interfering State Laws 88 

Full particulars. , 90 

Yaluable Infokmation for Patent Owners ..... 92 

Patent Laws and Decisions 92 

Injunctions 92 

Infringements 92 

Damages 93 

Employing workmen to assist in reducing an Invention to 

practice 93 

Patent Ofllce Kules and Regulations 94 

Table of official fees 94 

How to obtain copies of any Patent 95 

Lapsed applications 95 

Kinds of Rights that may be sold 95 

Recording Deeds in Patent Office 95 

How to obtain the Rules of the Patent Office 93 

No more Extensions ; 96 

Concerning the importance of good Blanks 97 



INTRODUCTOEY. 



This volume is prepared in the interest of Inventors 
only. The constant aim of the author has been to 
deal with every part of the subject in a plain, common 
sense way, to present in a condensed form practical 
advice to those seeking to sell their Inventions, or 
who wish to effect arrangements for the manufacture 
of their improved articles on royalty. 

It is assumed that all Inventors or Patent Owners 
into whose hands this Book may fall are desirous of 
realizing from their Patents, and would have done so 
ere this if they had only known how to effect their 
purpose ; the endeavor is here made to point out some 
practical methods and to suggest such plans as will 
be likely to aid the inexperienced in the accomplish- 
ment of the result they so much desire. 

How many deserving Inventors there are who have 
no business faculty to originate a plan to sell their 
inventions, and who are to-day leaning on their 
Patents trusting for some favorable development that 
is to lead to a realization of their hopes, but who, not 
meeting with success, are compelled to live in a con- 
tinual hand-grip with poverty. It should be borne in 
mind that, however minutely certain rules may be 
laid down, the judgment of the Inventor must, after 
all, be relied on ; it is, however, believed to be hardly 



8 

possible that a Patentee will fail to find a purchaser 
for a practical invention of merit, if he will endeavor 
first to understand, and then intelligently to put into 
practical use the directions and instructions here 
given. 



THE FIRST THING TO BE DONE. 



We will suppose that you have made a really meri- 
torious invention, and have secured a Patent therefor. 
The first thing to do is to decide how you prefer to 
operate it so as to realize. This is an important mat- 
ter and requires careful thought. 

Some inventions can be successfully worked in one 
manner, and others must be managed entirely different. 
If a general rule can be given we should say that (1st) 
an improvement on any common article, machine, 
implement or process, which can be made or used 
complete and perfect without infringing any patent in 
force, the same not being sold by Merchants as an 
article of trade, can be sold if desired by State, County, 
Town or Shop Rights. Of this class may be named 

Agricultural Implements. 

Boot and Shoe Machinery. 

Brick Machines. 

Carriages, some improvements. 

Fences. 

Gates. 

Gas Improvements. 

Household Articles. 

Leather, (tanning.) 

Looms. 

Mill Luprovements. 



10 

Photography, some improvements. 

Steam Engines. 

Wash Boilers and Machines. 

Wood- Working Machinery, &c. 

(2d.) Any invention which is an improvement on a 
part of some patented machine, implement or process, 
of a character requiring a large outlay of capital, or 
which is an article that is sold generally by the trade, 
(that is by store-keepers) — as for instance an improve- 
ment in Door Locks, all such Patents had better be 
sold or let on royalty to the manufacturer of the Patent 
Machine on which it is an improvement, or to those 
who make such articles for the trade. State and 
County Rights cannot well be sold on such Patents as 
the following : 

Brushes. 

Billiard Tables. 

Clocks. 

Carpenters' Tools. 

Fishing Tackle. 

Fire Engines. 

Hinges. 

Locks. 

Musical Instruments. 

Printing Presses. 

Surgical Instruments. 

Skates, etc. 

But good improvements on these articles may always 
be sold to the Manufacturer. 

Each Patent Owner must decide for himself ^ow? he 
will operate his patent, whether he will sell territorial 
rights, that is, dispose of the patent franchise by piece 
meal, or sell the entire Patent with all interest to one 



11 



party, or contract with a Manufacturer to make and 
sell the article on the payment of a royalty^to the 
Inventor. 



ROYALTY 



An Inventor enters into a written contract with a 
manufacturer agreeing to allow him to make and sell 
his patented article, in consideration of the latter pay- 
ing a specified sum or duty upon each article when 
sold. The manufacturer terms this authority his 
license, and the duty or license-fee is called Royalty. 
This is a common method of realizing from a Patent, 
and one that manufacturers generally prefer ; and it 
often proves a very profitable method of operating a 
patent, sometimes producing a large annual revenue 
to the owner. 

THE RATE FOR ROYALTY. 

The amount of royalty, or license fee, to be asked 
by a Patentee, when giving a license in this way, 
should be regulated by the character of the improve- 
ment, and will vary from three to twenty per cent, 
on the retail price of the article. 

Of course manufacturers aim to secure the use of a 
Patent by payment of as small a royalty as the In- 
ventor will submit to ; and those Inventors who expect 
to license several manufacturers will only need to be 
reminded that whatever license fee or rate of royalty 
they accept from the first party will likely become the 

te for all subsequent manufacturers. 



13 

VALUABLE SUGGESTIONS. 

If the improvement is of doubtful utility, or if the 
claims of the Patent are not broad enough to practi- 
cally exclude similar articles from the mark^ t, or should 
there be any reasonable doubt about a manufacturer 
selling a large number, in either such case we advise 
Inventors to decide against the royalty plan, and en- 
deavor to sell the Patent outright. 

But in case it is determined to license manufacturers, 
be careful to include the following points whrn making 
the contract. 

HOW TO MAKE A CONTRACT WITH A MANUFACTURER. 

If it is the intention to license several parties, be 
careful to use no term, in the first contract, that can 
be construed to mean exclusive. At stated times, 
either monthly or quarterly, the manufacturer should 
be required to render to the Inventor a true and exact 
account of the number of articles made and sold, and 
to this statement he should make oath. The Inventor 
or his accredited agent should have the privilege to 
examine the manufacturer's books, to satisfy himself 
of the correctness of the account. 

State when the license fee shall be due and payable. 

The manufacturer should not be left free to make 
as many or as few as he pleases, for if the new article 
would interfere with anything else which he was en- 
gaged in manufacturing he might prefer to make none 
at all ; therefore the contract should contain a clause 
binding the manufacturer to pay a certain amount, 
monthly or quarterly, as the case may be, even snould 
he not make and sell enough articles to equal that sum 
at the rate of royalty agreed on. 



14 

Reserve the right to revoke and terminate the 
license, in case the manufacturer does not pay 
promptly the license fee agreed on. It is well also to 
reserve the right to sell the Patent at any time after, 
say, three years. 

The following is recommended as 

A FORM FOR LICENSE CONTRACT. 

This agreement, made this 1st day of June 1875, 
between David O. Smith, of Elmira, Illinois, party of 
the first part, and James L. Moore, of Cincinnati, Ohio, 
party of the second part, witnesseth — 

That whereas Letters Patent of the United States, 
No. 73,513, for an Improvement in Wash Boilers, was 
granted to the said party of the first part. May 16th, 
1868, which said patented improvement the party of 
the second part is desirous of manufacturing; now, 
therefore, the parties have agreed as follows : 

1st. The party of the first part hereby licenses and 
empowers the party of the secon 1 part to manufacture 
and sell said improved Wash Boilers, at his factory in 
Cincinnati, and in no other place or places, to the end 
of the term for which said Patent was granted, subject 
however to the conditions hereinafter named. 

2d. The party of the second part agrees to make full 
and true returns, under oath, quarterly, that is to say, 
upon the first days of January, April, July and October 
in each year, of the number of said Wash Boilers made 
by him during the preceding three months, and the 
statement showing this account shall be sent by mail 
to the address of the said party of the first part. 



15 

3d. The party of the second part agrees that all his 
books of account containing any items, charges or 
memoranda relating to the manufacture or sale of 
these Wash Boilers, shall be open at all times to the 
inspection and examination of the said party of the 
first part, or his accredited agent. 

4th. The party of the second part agrees to pay to 
the party of the first part forty (40) cents, as a license 
fee upon each and every one of said patented Wash 
Boilers made and sold or removed away from said 
factory ; and said fees or royalties for each quarter 
shall be paid in cash within ten days after the regular 
return day for that quarter. 

5th. And said party of the second part agrees to 
pay to the party of the first part at least one thousand 
dollars per annum, during the continuance of this con- 
tract, as license fees, even though he should not make 
enough of said Wash Boilers during the year to amount 
to that sum at the regular fee of forty cents apiece. 

6th. Upon failure of the party of the second part 
to make returns or payment of license fees, as herein 
provided, for thirty day^ after such returns or pay- 
ments are due, then the party of the first part may 
revoke and terminate this license and annul this con- 
tract, by serving a written notice to that efiect upon 
the party of the second part ; but said party of the 
second part shall not thereby be released or discharged 
from any liability for the license fees due at the time 
of service of said notice. 

7th. The party of the first part reserves to himself 
the right, after three years from date of this contract, 
on giving three months' notice, to sell the Patent and 



16 

his entire interest therein, in which event this contract 
shall cease and terminate. 

In witness whereof the above named parties have 
hereunto set their hands at Cincinnati, Ohio, the day 
and year first above written. 

Witnesses: David O. Smith, 

Wm. W. Watson, ) James L. Moore. 

Sam. S. Suter. f 



SHOP RIGHTS. 



This is a right granted by the Inventor by virtue of 
which the owner of a shop or factory is licensed and 
empowered to make the improved article and sell the 
same at his place of business. 

If it is deemed best to make this kind of a sale, some 
restriction should be placed upon the grant or license 
in order to protect the Patentee's interest ; the impor- 
tance of restrictions of this nature are obvious when 
it is considered that a shop or factory may, after the 
purchase of such a right, so enlarge and extend its 
business in making and selling the patented article, as 
to practically monopolize the entire market. 

The following form for a shop right in the main 
part, is the one generally used, but the author has 
incorporated therewith such restrictions as will pre- 
vent the growth of this license into an overshadowing 
monopoly. These restrictions are printed in italics. 

FORM FOR SHOP RIGHT LICENSE. 

In consideration of one thousand dollars to me paid 
by John W. Wilson of Saint Louis, Missouri, I do 
hereby license and empower the said John W. Wilson 
or assigns, to manufacture and sell at his factory in 
St. Louis, and in no other place or places, the improve- 
2 



18 

ment in Wash Boilers for which letters patent of the 
United States No. 73,518 were granted to me May 
16th, 1868. This riglit is granted on the following con- 
ditioTiSy namely : that said Wilson shall keep a full 
and true account, in suitable hooks which shall be open at 
all times to my inspection, of all wash boilers made and 
sold or removed away from said factory ; and on the 
further condition that a fee of thirty (30) cents shall be 
paid to me by said Wilson or assigns, on each and every 
wash boiler made and sold or removed away from said 
factory in St. Louis, in excess of eighteen hundred (1800) 
per annum, the first year commencing at this date, 
and settlements and payment of royalty, should any be 
due, to be made within ten days after the expiration of 
each year. On a compliance with tliese conditions this 
right shall continue to the full end of the term for which 
said letters patent are granted. 
Witness my hand this first day of June, 1875. 

David O. Smith. 
If the Inventor sends out a traveling Agent to^sell 
"Shop Rights" he should have suitable blanks pre- 
pared with the " Special Notice '* printed thereon in 
red ink same as on the Deed and Contract, which see. 



TO ASCERTAIN THE VALUE OF A PATENT, 



While no absolute rule can be made that will 
always correctly determine the value of an invention, 
it is necessary to have a reliable method for estimat- 
ing such values in an approximately correct manner. 
If the invention is an article useful in every house- 
hold, the market for it will be about one- fifth of the 
entire population of the Uuited States, as there are 
five persons, on an average in each family. By the 
census of 1870, there are 7,579,363 families in the 
United States ; and if every family required one of 
the articles, and each article would last a life-time, it 
might be said there is a market for seven million five 
hundred and seventy-nine thousand of the articles. 
If the article was not so durable as to last a life-time, 
but in the usual course of things would soon wear out, 
then in such case the market would be much greater 
than just stated, because the article would require to 
be frequently renewed. But in point ot fact no house- 
hold invention, however ingenious and important, is 
likely to be so universally adopted. In the first place, 
it is quite probable that one-half of the families in the 
United States would never know or even hear of the 
invention ; and of the other half, to whose knowledge 
it might come, likely not more than one-half of them 
would buy ; so that, on this basis, one-fourth of the 



20 

whole number of families in the United States is as 
great a proportion as the best inventions in the line 
of household articles can be relied upon to supply. 
One-fourth of the families in the United States is 
1,894,840. It will be noticed no allowance is made in 
this estimate for competing articles ; and if other good 
articles of a similar kind were out, perhaps it would 
be nearer the mark to divide this result, allowing one- 
half of this number to be supplied by other devices. 
Thus the possible market for your invention is about 
one-eighth of the entire number of families, namely, 
947,420. 

Now suppose the actual first cost of producing the 
article is twenty cents, when made in large quantities, 
and the retail selling price is one dollar each, showing 
a profit of eighty cents on each one, which profit must 
be divided among the manufacturer, wholesale dealer, 
and retail dealer or canvasser, (or if not sold by the 
wholesaler, then the profit allotted him can be reck- 
oned as expended in advertising, &c.,) the canvasser 
being the one who will have the most work to per- 
form, should have the largest proportion of profit. 
To the manufacturer allow say fifty per cent., or ten 
cents on each article ; to the wholesaler (or for adver- 
tising) allow fifty per cent, profit on the manufacturer's 
price, or fifteen cents on each one ; to the retailer or 
canvasser allow one hundred per cent., or forty- five 
cents on each, still leaving ten cents on each to be 
divided between sundry expenses and the share pro- 
perly due to the Inventor, so that each one of the 
articles should pay the Inventor a royalty of five cents. 
But if he was selling out the entire Patent Right, he 
could afibrd, on the basis here made, to take perhaps 



21 

one-fourth of this portion or allowance ; thus 947,420 
articles, at IJ cents each, would be $11,842.75, the 
present estimated cash value of the Patent. 



THE PRICE OF TERRITORIAL RIGHTS. 

If the Inventor decides to sell Territorial Rights, he 
must have some systematic plan for fixing prices, 
although any plan that can be devised will obviously 
be of an arbitrary nature. 

If the value of the entire Patent is fairly estimated 
to be twelve thousand dollars, if sold all at one time, 
the Inventor should realize double that amount if he 
sold out Territorial Rights piecemeal as it were. 
Clearly he could not afford to sell a single State Right 
in the same proportion that he would sell the whole 
Patent. Therefore, to fix the price for a Right, first 
double the estimated value or price for the whole 
Patent. Thus a State Right would be worth such 
portion of $24,000 as the population of the particular 
State in question bore ratio to the total population of 
the United States. For instance, the State of Illinois, 
with a population of 2,539,891 — for the sake of round 
numbers, call it 2,500 000. To state it arithmetically, 
according to the rule for proportion, it would be 

Population Population Double price Price of 

oftheU. S. of Illinois. of Patent. ■ State Illinois. 

38,000,000 2,500,000 24,000 = 1,578.94 

Thus : 24,000 

2,500,000 

12,000,000^000" 
48,000 



60,000,000,000 



23 



38,000,000) 6a,000,000,000 (1,578.94 
38 



220 
190 

300 
266 



340 
304 



360 
342 

180 
152 

28 

So that the price for the State of Illinois would be 
$1,600.00 in even figures. 

This method will do where the State in question is 
average territory, but in extra good or in the best ter- 
ritory, to fix the price of a State Right we recommend 
first to treble the estimated value of the whole Patent, 
instead of simply doubling it. 

The price for a State Right being fixed in some 
such manner, the value of a County Right may be 
ascertained in several ways. One method is to first 
quadruple the value of the State Right, and then on 
this basis estimate by proportion, as above explained. 
Another method, involving less figuring, which we 
have found to work well in practice, is to adopt a 
scale to fix the price of Rights in which the rate pro- 
gresses as the population decreases. It would hardly 
justify the Inventor to charge the same rate per thou- 



24 

sand population for both large and small counties. 
To illustrate : if he was charging $5.00 per thousand 
population, one county having 15,000 would bring 
$75.00; another having 60,000 would bring $300.00. 
Now it would require just as much effort (probably 
an equal expenditure of time and money) to sell the 
small county as the large one, and he realizes from 
the small county only one-fourth as much as from the 
large one. This plan would likely result in selling 
off the best or largest counties first, and then it would 
be found unprofitable (owing to the expense incurred) 
to sell the small counties at all. It is better, there- 
fore, to average the rate per thousand in its application 
to counties of different sizes; in other words, to charge 
less per thousand population for large counties, and 
more per thousand for small ones. 

SCALE TO FIX THE PRICE OF RIGHTS. 



When the 
ropulation is 


Rate per 1^00 Price of 
should be Right. 


15,000 


$7 00 $105 00 


20,000 ' 


6 50 130 00 


25,000 


6 00 150 00 


30,000^ 


5 50 165 00 


35,000 


5 00 175 00 


40,000 


4 50 180 00 


50,000 


4 00 200 00 


60,000 


3 50 210 00 


100,000 


3 00 300 00 


200,00(J 


2 50 500 00 


300,000 


2 00 600 00 


When the population is between the amounts set 


down in the above scale, multiply by the rate per 


thousand used 


by the amount nearest to the popula- 



25 

tion in question. This scale is arranged with the 
belief that it fairly fixes the value for good average 
inventions, keeping in view the expense of traveling^ 
to sell Rights ; but it may be easily made to place less 
or greater values on Rights by multiplying the popu- 
lation by the next loTver or higher rate per thousand. 



now TO PROCEED. 



Whatever plan of operating your Patent is decided 
upon — whether to let on Royalty or to sell Rights — 
it is absolutely necessary, if it is a machine, tool or 
piece of mechanism, to have one or more perfect work- 
ing models. If the invention comprises a machine 
which is not too large and expensive, the Inventor 
should have at least one full-sized machine that will 
operate perfectly. It will not do to have merely a 
roughly constructed affair — the machine that is 
intended for public exhibition must be perfect in all 
its parts. Inventors usually find enough to contend 
with when exhibiting their improvements, without 
having to excuse and explain away poor workmanship 
or faulty construction. A fine piece of mechanism will 
draw attention where a rudely made device will 
hardly be looked at. 

If the invention is a small article, such as a Door 
Stop or Sash Fastener, it is better to have a number 
made. It is necessary, in order to properly present 
the improvement, to prepare a circular which will 
contain a description of the invention, and set forth 
its advantages in as strong and favorable a manner as 
the facts will bear. If susceptible of illustration — as 
all mechanical devices are— this circular should bear 



27 

a good "cut" or engraving of the machine or patented 
article. If living in a location where the services of 
a vrood engraver cannot be obtained, it is best to have 
a good photograph taken of the article, and this can 
be sent by mail to any of the larger cities where an 
engraver may be found. If the " cut " is satisfactory 
when done, it is best to have a number of electro- 
types made therefrom, and use these to print from. 
Beside it will aid you in making sales of Eights, if 
you can give each man who buys a State or County 
Right one of these electrotype * cuts " to print his 
circulars from. They will likely not cost more than 
one or two dollars each, and are easily worth ten 
times as much to a purchaser of a Right. 

If the Inventor does not feel himself competent 
to do justice to the subject in preparing this circular, 
he had better ask some properly qualified person to 
assist him. 

PREPAKATIONS THAT ARE IMPORTANT. 

In addition to the models and circulars, it will be 
essential for a person who is about to undertake the 
sale of Rights to have ready at his command all the 
important facts that have any bearing on the inven- 
tion, such as relate to first cost, net profit, extent of 
demand for the article, etc. Of course correct infor- 
mation of this kind can be obtained only by energetic 
and intelligent application. 

PAVING THE WAY FOR SALES. 

When an Inventor has pursued these inquiries and 
investigations for several months, he will be in a bet- 



28 

ter position to settle on the probable value of his 
improvement. Generally Inventors set too high a 
value on their inventions, or at least seem to forget, 
when trying to sell their patent, that the lion's share 
must be offered as an inducement for some one to 
purchase. If it is decided to license manufacturers, 
the advice or suggestions of friends who are in a 
business that is such as to make them conversant with 
the market for the article in question will be of great 
aid in determining the rate of royalty to be asked. 

Having settled on the plan by which the Invention 
will be operated, it may now be important to find a 
responsible manufacturer who will undertake to make 
the article. If you let it on royalty, you want to get 
it into good hands, preferably some concern that is 
largely engaged in making and selling articles of the 
same class. If you intend to sell Territorial Rights, 
unless the article can be readily made by any good 
mechanic with ordinary tools, you must first pave the 
way by effecting a favorable arrangement with some 
first-class manufacturer to make the article, who will 
agree to supply those who may purchase Rights. 

TO OBTAIN THE NAME OF MANUFACTURERS. 

Suppose the Invention is an improvement in Sash 
Fasteners, the Inventor will want to know how to get 
the names of those who are engaged in manufacturing 
such goods. A full list of ull parties engaged in that 
branch of manufacture is not necessary, but to know 
who the leading ones are is essential. The first step 
is to call on some friendly dealer who sells such goods. 
As you desire his assistance, of course you must take 
great pains to exhibit and explain the improvement ; 



29 

you must endeavor to get him interested in it. Even 
if he is personally unacquainted with the manufac- 
turers, he can likely give you the names and address 
of some of them, as makers of good articles usually 
have their name on labels which are attached in some 
manner to the goods. At least a friendly dealer can 
give you a letter of introduction to one or more 
wholesale dealers in that class of goods in the city 
where he purchases his supplies. 

BUSINESS METHODS. 

Having secured in this manner all the information 
possible, you will now set out to the city with your 
letters of introduction, models, circulars, &c., and, 
presenting yourself at the wholesale merchant's, de- 
liver your letters. If properly approached, and your 
object frankly explained, these dealers will generally 
be found ready to afford assistance. They can always 
name the principal concerns who are engaged in 
making any particular class of goods, and advise you 
which one of them would probably be the best to take 
hold of your invention ; and they can likely give you 
other items of information. 

TIMELY ADVICE IN THIS CONNECTION. 

It now lies probably between one of two or three 
manufacturers. You will next make a personal visit 
to one of these. It will not do to depend on writing 
a letter; very often letters are not understood, and 
may not even be answered, while a personal inter- 
view, accompanied by a plausible demonstration of 
the merits and desirableness of the improvement, will 
suffice to awaken an interest in the invention. 



30 

THE WAY TO APPROACH MANUFACTURERS. 

In approaching manufacturers, you must bear in 
mind they will exact of you facts and figures in a 
business like way, and you must be prepared, by the 
aid of models, and the statistics at your command, to 
show its advantages and the money there is in it. At 
first the managers of these concerns may give you a 
rather cool reception, for they are frequently besieged 
by persons with patented improvements, who present 
a string of shallow reasons why their particular inven- 
tion will "revolutionize the world,'* and make a 
fortune for every one connected with it. But this 
sort of thing has no weight with practical business 
men. Manufacturers want improved articles of utility 
that will sell. To secure their favor the article must 
be better or cheaper than others of a similar kind. 

In negotiating with a manufacturer, some allowance 
must be made for his disposition to drive a sharp 
bargain ; while it won't do to give way in the matter 
of price too easily, on the other hand you must not be 
too firmly set in your demands. 

If you are seeking to let your Patent on royalty, it 
is advisable that you have your own mind made up 
what rate you would rather accept than to mus entirely; 
and in general it will be found much easier to con- 
clude terms on the basis of royalty than if you were 
trying to seU outright, for in general manufacturers 
do not want to buy an untried invention. 



EXCEPTIONAL INVENTIONS. 



While patents on many of the minor inventions 
relating to improvements on articles in constant use 
by the masses of the people, such as household arti- 
cles, may readily find sale among dealers, manufac- 
turers and enterprising men of moderate means, there 
are numerous valuable improvements that have a 
more circumscribed market, the purchasers for such 
being limited more strictly to those who are engaged 
in the particular business of making the article, or for 
whose special use the improvement is, from its nature, 
necessarily confined. Take, for instance, an improve- 
ment in piano-fortes or church organs ; the only parties 
likely to purchase such a patent are the manufacturers 
of these articles ; and the same is true of many other 
inventions, among which may be named fire-proof 
safes, ship's tackle, reapers and mowers, and many of 
the sewing machine improvements, such as must be 
incorporated or combined as a part of tJie machine at 
the time of its production. 

Another class of improvements that may come 
within the category of " exceptional " are all such as 
relate to railroads ; and still a third class are those 
which relate to some public or government use, or 
which are under the control of State or municipal au- 
thority. For instance, street letter boxes, and similar 



32 

things controlled by the United States Government ; 
fire plugs, improvements relating to water supply for 
cities, indexes for public records, etc., which are con- 
trolled by the authorities of States or cities. 

Inventors of such improvements better make up 
their minds at once to manifest some liberality. The 
great desideratum is to have the improvement practi- 
cally tested, for if it can be demonstrated by actual use 
to be valuable, to really possess the advantages claimed 
for it, the Inventor can then make his own terms. 

HOW TO MANAGE THEM SUCCESSFULLY. 

If the improvement belongs to the exceptional class 
first named, some reliable manufacturer must be found 
who will try it. To this end you must offer him some 
inducement. For instance, propose to the right party 
to allow the improvement to be applied, free of any 
charge for use of patent^ to a certain number of the 
articles, say one hundred pianos, twenty-five loco- 
motives, or one hundred reapers, as the case may be ; 
but the number should be sufficiently large to both 
test it thoroughly and to be of some pecuniary profit 
to the manufacturer. It is of the utmost importance 
that you, as the Inventor, should exhibit a readiness 
and willingness to have the manufacturer reap some 
substantial advantage from the operation, for it is easy 
to see that if you only are to be benefited no one will 
care to trouble themselves with it. 

At this stage is the proper time to come to an un- 
derstanding in regard to the price and terms which 
are to govern if the patent is to be sold, or the rate of 
royalty the manufacturer shall pay if you are to license 
him to use the improvement. 



33 

HOW TO SELL RAILROAD INVENTIONS. 

If the inventioii is an improvement in railway roll- 
ing stock, fur instance a journal box or a car coupling, 
you will experience no little difficulty in getting it 
adopted unless great tact is employed. Depend on it 
railroad companies will not send their officers and 
agents after your invention, even if it is really the best 
thing ever invented. 

Probably the best plan that can be devised is to 
construct a perfect working model, full size if possible, 
but at all events it must be neatly and accurately 
made, so as to exhibit the operation of the improve- 
ment in a perfectly clear manner. 

Now with such a model seek an interview with the 
proper officer of some railroad. If any intiuential 
person can be brought to your aid at this time, it may 
be well; but with or without such aid, get the 
matter before the proper officer, and if it meets his 
approval, then pi^opose to Mm in writing to allow his com- 
pany to use the invention on their own road, on any 
and all their cai-s, free of any charge or license fee 
whatever, for a term say of eight years, or some other 
given time. But in consideration of you making no 
charge for the use of the invention, the railroad com- 
pany should agree to at once apply the improvement 
to a certain number of cars, and as the article is satis- 
factorily tested to continue to add the improvement 
to other cars from time to time, until it shall be 
applied to all their rolling stock ; and further, if it 
prove satisfact.ory, the general officers of the com- 
pany shall, at any time, on request made by the 
Inventor, give a certificate stating the extent to which 

3 



34 

they have used the improvement, aud with what 
degree of economy and satisfaction 

It may sometimes be advisable, in order to secure 
the assistance of some influential person in eflecting 
such an arrangement, to enter into a contract binding 
yourself to pay a certain portion of the price or 
annual revenue derived from a Patent of this kind, 
in consideration of such assistance to be actually ren- 
dered. Such an agreement or contract may be 
entered on the records at the Patent Office, and will 
be binding on the Patent Owner. 

A CAUTION. 

A word of caution here may not be amiss. Be on 
your guard as to making such an agreement as just 
suggested ; you should have good reason for the 
belief tbat the person who undertakes to render you 
assistance in promoting the sale of your patent, has, 
or can bring to bear, the influence of which you stand 
in need ; on this point there should be no reasonable 
doubt— you cannot aflbrd to " depend on a broken 
stick." 

Again, in addition to the influence this party may 
possess, he should be a man on whose integrity you 
can rely. 

Under no ordinary circumstances should you 
make an assignment of an interest in your Patent for 
services not yet rendered; with one in whom you 
have implicit confidence you might pursue such course, 
but many mistakes of this kind have been made by 
inventors, resulting in irreparable loss. 



85 

Whether you deem it necessary to bring such ex- 
traneous influences to your aid or not, if you can 
effect an arrangement with a raih'oad company, such 
as indicated, for the trial of an invention of real merit, 
you may rest assured the time will soon come when 
you can confidently approach other railroad com- 
panies with such evidence as to the utility and desira- 
bleness of your improvement as will command atten- 
tion, and enable you to make profitable arrangements. 

SELLING RIGHTS TO PUBLIC AUTHORITIES. 

Inventors who have improvements on an article or 
thing beneficial or advantageous to some public use, 
and which are controlled by municipal. State or Na- 
tional authority, find it necessary often to employ all 
sorts of means to attract the attention of the "powers 
thai be." ' 

To effect a sale of such an improvement it must be 
one that is in demand, it must be really necessary or 
highly important, and it should be the best thing of 
the kind known. If you possess an improvement hav- 
ing these advantages do not spoil your chances for a sale 
by interesting in it any political "bummer," to use a 
slang name. In most every community there are 
men known as political hacks, whose occupation is to 
maintain their own prominence, to have a hand in 
political manipulations, to always be "in the ring." 
Men of this stamp are generally ready to engage in 
any undertaking, no matter of how questionable a 
character the same may be, if it promises to enrich 
themselves ; in short, they are always **on the make," 
and, it must be added, without much regard as to the 
manner in which it is done. Such men assume to 



36 

know everybody, to know all about every local mat- 
ter ; they are just the men to impose themselves on a 
stranger, to assert their ability to "put the thing 
through." 

This is a fair description of the kind of men a 
stranger will meet with in every county town in the 
United States.* Occasionally there may be work for 
such men to do in selling a patent right to the county 
or city authorities, hut as a rule they are just the men 
you should avoid; do nothing whatever that can iden- 
tify such a man, or connect him in any way with your 
improvement, for nine times out of ten he will do you 
more injury than benefit. 

PRACTICAL SUGGESTIONS. 

Let us now suppose you are in a city, a total 
stranger, for the purpose of bringing your improve- 
ment to the notice of the authorities. It will be of 
undoubted advantage to have the assistance of at 
least one influential person — he should be a man of 
standing, that is a man of known good character. 

The inquiry naturally arises " how to obtain the 
assistance of such a man ?" In whatever way you 
proceed it will require deliberation and patience ; it 
will not do to act precipitately. The proprietor of 
the hotel whereat you are stopping can give you the 
names of the most acdve and reliable lawyers in the 
place, and men of this profession will likely be quali- 
fied to advise and aid you, because of their acquaint- 
ance with local politics, with the ofllcials about the 
Court House, etc. For these reasons a lawyer is sug- 
gested, if a suitable one can be found willing to take 
hold of the matter. 



37 

The hotel proprietor can also give you the names 
of several enterprising merchants who usuaHy take 
some interest in public matters ; you should call on 
one of these merchants, and introducing yourself by 
name, say you are a stranger in the place, and desire 
to make confidential inquiry as to the standing of 
several of the lawyers ; it will be better, perhaps, not 
to refer to your particular business, nor to divulge the 
kind of an arrangement you desire to effect. By a 
little tact you can draw out his opinion regarding the 
several lawyers whose names you have ; even should 
he be reserved in his expressions, you can no doubt 
learn something, in course of conversation, that will 
help to put you on the right track. 

Having learned from this party all the information 
he will give, proceed to call on another merchant 
whose name you may have, and go through the same 
operation, and continue in this way to quietly make 
inquiries about the several lawyers whose names you 
have. You will not be long in obtaining information 
enough to enable you to decide who is likely the most 
desirable man for you to arrange with. When your 
mind is made up on this point, call on the party and 
explain your business, show your letters-patent, and 
endeavor to make a favorable impression as to the 
advantages your improvement would be to the city. 
Say to him you find it necessary to have some assist- 
ance, and you are looking for a reliable man who will 
advise you, and give you information about the offi- 
cials with whom you will have to negotiate, and who 
will generally assist and co-operate with you to carry 
the enterprise through. 



38 

Make Mm understand that you propose to he the active 
man— the only one known to the authorities^ while your 
adviser 'shall remain in the back-ground^ in order to be 
able the better to promote the success of the enterprise. 

With this preliminary understanding you can say 
that perhaps it would be agreeable to him to become 
interested in the matter. If his response is not 
decided, and especially if it is not unfavorable, you 
may know he is waiting to have an expression from 
you as to hoio much of an interest you propose to give. 

Being thoroughly satisfied, first of all, that you are 
about to get the aid of the right kind of a man, offer 
him at once such a share in the proposed sale as will 
secure his active interest. Propose to enter into a 
writing agreeing that he shall have one- fourth (or 
one- third) of the amount realized, in consideration of 
his services and assistance to be rendered in eff*ecting 
the sale, which said services and assistance he shall 
be ready at all reasonable times to render until the 
sale is finally closed. 

It will generally be the better course to put your- 
self under his advice and direction, to hold frequent 
consultations with him, and together to discuss and 
determine the proper coui*se to pursue. He can likely 
serve you better, more effectively, by maintaining 
incog his inteiest, and doing the passive work, while 
you should be the only active man known to the 
authorities. 

Your adviser may be able^ in a quiet and unobtru- 
sive manner, to enlist some of his discreet friends in 
favor of the enterprise, and thus by tact and careful 
management an influence favorable to your project 
will gradually be brought to bear on the authorities 
that will be certain to be felt. 



.39 

If the utility and advantage of youtt improvement 
can be readily demonstrated, a public exhibition of 
them should now be made ; now is the time, after a 
public sentiment in the right quarter favorable to 
your improvement has been built up, now is the time 
to make public demonstrations. A practical exhibi- 
tion or test of the improvement will count more in 
your favor now than a week's mere talk and expla- 
nation alone would accomplish. 

In all these movements there should be a co-opera- 
tion and concert of action between yourself and ad- 
viser, and with good management it is hardly likely 
you will fail to eflect a sale. 

With regard to inventions which are salable to the 
United States Government, it is advisable, in fact 
necessary, to have some one interested with you in 
the matter who is familiar with the particular Depart- 
ment it is desired to reach ; and the standing of this 
party should be such as will reflect credit on your 
undertaking. One good man, familiar with the rou- 
tine, and favorably known in the Department, can 
accomplish more than half a dozen green members of 
Congress ; besides, it is not advisable to have a num- 
ber interested in negotiations of this kind ; the trite 
saying, "too many cooks spoil the broth," is applica- 
ble here. . 



SELLING TERRITORIAL RIGHTS. 



If it is contemplated to sell State and County Rights, 
a very thorough preparation becomes necessary. In 
this business, as in almost all others, you will meet 
with rebuffs and discouragements, and the Inventor 
or salesman who would succeed must possess the 
qualities of persistency and perseverence. It is at the 
outset, perhaps, that the most disheartening obstacles 
seem to present themselves, and yet this is only appar- 
ently so, and is owing chiefly to the feeling of raw- 
ness which one is apt to experience when they com- 
mence an undertaking which must be regarded as an 
experiment. But a few successful strokes will set a 
man on his feet, and give him fresh confidence in his 
eventual success. 

The United States being such an extensive country, 
and salable patents being likely to find purchasers of 
territorial rights in any part of the land, it is evident 
that one man would be a long time in traversing the 
whole of it; then, too, it may be that the Inventor is 
unable himself to travel; perhaps he finds it necessary 
to remain at home and continue in the pursuit of his 
regular business. In either such case it is best to 
secure the services of several good agents. 



41 

TRAVELING SALESMEN. 

Persons may be found in almost every town in the 
United States who are willing to engage as agents for 
a promising invention to sell rights. No doubt some 
who are honest can be employed for this purpose ; but 
the experience is that while many who are thus ready to 
engage themselves are capable, very often they are not 
reliabJe. The deception and even fraudulent practices 
to which ordinarily they may resort, and the loose 
manner in which they frequently do their business, is 
calculated to deter careful men from purchasing, and 
these facts no doubt operate as a great drawback in 
securing the attention of persons who would likely 
become purchasers. 

DIFFICULTIES. 

When an agent sells a right he may not choose to 
make a report of it, and if he does not, the patentee 
will likely be none the wiser, for he is almost wholly 
dependent on his agent for information relative to 
sales. 

While traveling, an agent may be in receipt of 
moneys belonging to a patentee, and continue to travel 
and sell rights for months without rendering an ac- 
count of his operations ; it is plain to see, if he intends 
to retain funds and deceive his employer, lie can easily 
do it 

A patentee has in general no redress, no legal remedy 
against the malfeasance of his own agent — what would 
be clear robbery done under other circumstances, is 
only a "breach of trust" here. 



42 

While an agent may be honestly disposed, he may 
yet make unremunerative sales, or he may transact 
his business in an improper manner, greatly to the 
loss of the patentee, who is unable to control his 
movement s. 

Parties are often found who would like to purchase 
the right of a certain county, or a certain portion of a 
State, but as the right of counties adjoining said ter- 
ritory had been previously sold without proper restric- 
tions, (such as would protect subsequent purchasers of 
adjacent territory in their full rights,) the negotia- 
tions for this last sale is brought to an abrupt termi- 
nation. Many persons entertain this fear of a want 
of protection who say nothing about ity and it deters 
them from buyiusr. 

As it is now, gentlemen who engage in this business 
are frequently looked upon with suspicion — everybody 
seems to distrust their representations, and their 
authority to act is often regarded as very question- 
able, though no such objection mag be openly expressed, 

HOW TO AVOID DTPPICULTIES. 

The onl}'- remedy that can be relied upon f^r these 
difficulties which arise from employing agents, is 
found in the method of coatroling these traveling 
agents as arranged in the system of blanks, by means 
of which the Inventor is able to completely control 
the sales and regulate the movements of his agents. 
It will be seen, by reference to the forms for Power 
of Attorney, Patent Deed and Contract, and the 
accompanjdng printed explanations, that the Inventor 
is not entirely dependent on the integrity of his agent. 



43 

By this system tlie agent is empowered to effect sales 
of rights, but he is not authorized to receive the money 
in payment therefor, (except such part as comes to his 
share,) and the purchaser of a right is compelled to 
immediately send to the Inventor a duplicate copy of 
the deed or contract, so that the Inventor receives 
notice promptly of all transactions which his agent 
makes. 



Tlie special points of this form for Poiver of Attorney are 
made prominent by italics, and following each is a letter in par- 
enthesis that refers to a corresponding letter, near the left hand 
margin of the explanation, on the pages immediately folloiuing^ 

POWER OF ATTORNEY. 



lids Autliority expires with the End of the Months and 
must he renewed by Monthly Ceriiflcate. [a) 

KNOW ALL MEN BY 1 HESE PRESENTS, 

That I, DAVID O SMITH, of Elmira, Illinois, owner of 
the entire rig-ht in and to Letters Patent of the United 
States, No. 73,513, for an IMPROVEMENT IN WASH 
BOILERS, dated May 16, 1868, do hereby make, constitute 
and appoint Robert S. Jackson, of Chicago, 111., my law- 
ful attorney, for me and in my name to sell, grant and con- 
vey exclusive territorial rights under said Patent, with 
power to sign my name to the printed forms or transfer blanks 
(b) headed "Grant of Exclusive Territorial Right,"— with 
power also to sign my name to the printed forms of Con- 
tract, [blank copies of both are furnished by me having a 
Special Notice printed thereon in red ink,] and, in my 
name, to receipt for all considerations received in payment 
or exchange for said rights, or paid on said contracts. 

But my said Attorney is not empoivered to sign for me any 
other instrument (c) than the two above named, or to bind 
me in any other manner further than to properly execute 
and sign the aforesaid blanks, without change or altera- 
tion of the printed portion. Said Attorney sJiall exercise all 
2)ower herein conferred under the following conditions, (d) with- 
out a compliance with which no act of his under this 
authority shall be valid or binding on me. 

FIRST. — The conditions sti2mlated in the ^'' Special Notice'' 
printed in red ink (e) on the blank forms, both for granting 
rights and making contracts, must be fully and strictly 
complied with by both the Attorney and the party pur- 
chasing or contracting. 

SECOND.— Each and every deed granting an exclusive 
territorial right, and each and every contract, shall show 
plainly and fully what price or consideration was paid, or 
agreed to be paid, by the party purchasing or contracting— 
whether it be cash, promissory notes, personal property or 
real estate. 

THIRD.— 6?^e-Aa^/ of all cash shall be delivered to me by the 
payer thereof {f) in one of the following modes, namely : 
1st, A check or sight draft payable to my order shall be 
obtained from the nearest bank, or responsible private 
banker, and in the presence of my said Attorney sealed In 



45 

an envelope and mailed and registered to me ; or 2d, Postal 
Money Orders, payable to my order, shall be so sealed in 
an envelope and mailed and registered to me ; or 3d, the 
money may be securely sealed in an envelope, in presence 
of my said Attorney, and then mailed and registered to me. 
The reimammg iiortion of cash shall be delivered to my Attorney, 
{g). Promissory notes must mature at least within four 
months from date of contract. They must he made in equal 
amounts (A)— one-half shall be made payable to my order, 
and mailed and registered to me in presence of my said 
Attorney ; and one or more notes of equal amount made 
payable to my Attorney and delivered to him. But all 
promissory notes, except those taken from parties pur- 
chasing on contracts, must be endorsed by a person or per- 
sons well known to be of ample pecuniary responsibility. 

Real Estate shall be conveyed to me, but no grant of 
right shall be made for such a consideration without first 
obtaining my eonsenL and approval by letter or telegram. 

FOURTH.— Any deviation from these conditions, by 
either my said Attorney or the party purchasing or con- 
tracting, will invalidate his acts in the particular case in 
question, and the same may be annidled^ revoked and termina- 
ted by me, (i) at my option, within thirty days from my 
receipt of information of said deviation, by a notice in 
writing first recorded in the Patent Office, and then mailed 
and registered to the address of the party purchasing or 
contracting. 

FIFTH.— My said Attorney may sell and grant rights, 
or execute and sign the contracts under this authority, for 
and within the States of Indiana and Ohio^ and no where 
else. 

THIS POWER OF ATTORNEY 5^aZ^ remain in force until 
and including the last day of -the iwesent month, (m) at which 
time it shall expire, and the authority of my said Attorney 
shall then cease and terminate, unless and except, on or 
before said date, this Power of Attorney is renewed and 
continued for one month longer thereafter, by having at- 
tached hereto a "Certificate of Renewal,"— an exact sam- 
ple copy of which is here printed : 

SAMPLE COPY OF CERTIFICATE OF RENEWAIi. 

Printed in Bed Ink. 

[The certificate cannot be shown in this contracted space; 

see full sized blanks for form of same.] 
and at the expiration of said month's renewal, this Power 
of Attorney may be again renewed and continued, for one 
month at a time, by having attached hereto other like cer- 
tificates of renewal duly signed by me. 

In Witness AVhereof, I hereunto set my hand at El- 
mira, Illinois, this Fifth day of June, 18'<5. 

DAVID O. SMITH, 

Owner of Patent. 
Signed and Sealed in the presence of 
Charles A. Wilson, 
Edward B. Dean. 



The, letiers in parenthesis, near the left hand margin of the 
following Explanation, refer to points in the form for Power of 
Attorney having corresporvding letters^ 

EXPLANATION OF POWER OF ATTORNEY. 



The provisions embodied in this Power of Attorney are 
fair and proper for all concerned. They are fair for the 
Inventor or Patent owner, because they secure to him the 
rightful disposition of his Patent, or the proceeds thereof. 
They are fair for the agent, because the share or per cent, 
commission due him comes into his hands at once. They 
are fair for the party who may purchase, because he has it 
in his power to get a valid and complete title to the right, 
simply by observing that the several conditions are prop- 
erly complied with. 

(a) No matter on what day of the month the Letter of 
Attorney may be dated, it ceases and expires on the last 
day of the month. 

ih) The Agent or Attorney has power to sign only the 
PARTICULAR FORMS OR BLANKS Which the Inventor fur- 
nishes, and no others. 

(<?) Should he sign anything else, the Inventor is not 
bound thereby. 

The agent is not allowed to alter these forms— neither to 
add to or take from. 

{d) If these conditions are complied with in good faith, 
a valid title passes to the purchaser ; if not complied With, 
the Patent owner is not bound. 

{e) The first of these conditions makes it equally obliga- 
tory on BOTH Agent and party purchasing to comply 
with the stipulation printed on the Deed and Contract in 
red ink, which provides for the purchaser sending a true 
copy of the Deed or Contract to the Patent owner, thus 
giving him a full report of the terms of the transaction. 

(/) All cash received from sales made by an agent is 
divided, so that the portion belonging to the Patent owner 
can be sent to him at once, and it is made incumbent on 
both the agent and purchaser to attend to this. No matter 
in what form the remittance may be, the envelope enclos- 
ing it must be registered; the oflftcial record thus kept 
makes it easy to investigate a case at any time. 

{g) T'he share of cash to which the agent is entitled, 
(generally one-third or one-half,) should be paid to him 
by the purchaser at the time of sale, thus ensuring satis- 
faction on the part of the agent. The agent can explain 
to the purchaser that this cash is necessary to furnish him 
with the means to defray his expenses. 

{h) If the agent receives a commission of one-half or 
fifty per cent, on his sales, all notes should be taksn in 



47 

two equal amounts ; but if he only g-ets one-third as a com- 
mission, then, in such case, notes should be taken in three 
equal amounts, one of them for the agent, and two for the 
Patent owner. 

(i) To annul, revoke or terminate any sale or contract, 
in case of non-compliance with conditions, the Patent 
owner has only to write a notice to the following effect: 
Elmira, Illinois, June 20, 1875. 

Having on the fifth day of June, 18T5, appointed Robert 
S. Jackson, of Chicago, Illinois, my Attorney to sell, grant 
and convey rights under my United States Patent, No. 
73,513, for an Improvement in Wash Boilers, dated May 16, 
1868, said Attorney to exercise all power therein conferred 
on certain conditions, which are fully set forth in said 
appointment, without a compliance with which no act of 
his should be valid or binding on me. 

And having received information, within the past thirty 
days, that said Robert S. Jackson, on or about the 10th day 
of June, 1875, signed one of my printed forms or transfer 
blanks selling and granting to Thomas Jones, of Hew 
Dover, Ohio, the right under my said Patent for and within 
the county of Union, in the State of Ohio, for a considera- 
tion said to be $300 cash, and inasmuch as the one-half of 
said money has not been paid or delivered to me, as re- 
quired and conditioned in my said power of attorney, now 
therefore I do hereby annul and revoke said sale or grant, 
and hereby give notice thereof to said Thomas Jones, and 
all persons concerned, as provided in said appointment of 
Attorney. 

DAVID O. SMITH, 
Witnesses: Oivner of Patent, 

Chas. a. Wilson, 

Lewis Brown. 

This revocation should be taken before a Notary Public, 
or Clerk of a Court of Record, sworn to and attested by 
his seal of office, and then enclosed in an envelope, with a 
fee of one dollar, to the Commissioner of Patents, Wash- 
ington, D. C, requesting that it be recorded and returned. 
When returned it should at once be mailed and registered 
to the address of the party said to ha%^e purchased. 

(m) At the expiration of any month the Patent Owner 
may allow his authority to terminate if he desires ; but if 
he is satisfied with his Agent, and desires him to continue, 
a ''certificate of renewal," good for the next ensuing 
month, is sent to the agent. This certificate, if properly 
punched, can not be changed or altered so as to be good 
for any other month. 



The special points of this form for Patent Deed are made pro- 
Tninent by italics^ and following each is a letter in parenthesis 
that refers to a corresponding letter near the left hand margin of 
the explanation^ on the page immediately following . 

GRANT OF EXCLUSIVE TERRITORIAL 
RIGHT. 



TO ALL TO WHOM THESE PRESENTS SHALL COME : 
Whereas Letters Patent of the United States, No. 73,513, 
for an Improvement in Wash Boilers was granted to David 
O. Smith, of Elmira, Illinois, dated May 16, 1868. 
Now THIS Indenture Witnesseth, 

That for and in consideration of three hundred dollars, 
($300) to me paid and delivered by Thomas Jones, of New 
Dover, Ohio, I do hereby sell, grant and convey to the said 
Thomas Jones, or assigns, the exclusive right to make, use 
and sell the aforesaid Patent Article within the county of 
Union, in the State of Ohio, and in no other place or places, 
on the condition that all AVash Boilers embracing said 
patented improvements sold by virtue of this authority 
shall he used and sold by the purchasers thereof only luithin the 
territory named {a) ; this Kight to be held and enjoyed by 
the party aforesaid to the full end of the term for which 
said Letters Patent are granted. 

In case the sale or grant executed on this blank is made 
by an agent, the consideration for the Right must be paid 
and delivered in accordance with the conditions named in the 
Poiver of Attorney (b) of each duly authorized agent, whose 
signature must be hereunto affixed, and said conditions are 
hereby made and shall be taken as a part of this contract, (c) 

In Witness Whereof, I hereunto subscribe my name 
at New Dover, Ohio, this tenth day of June, 1875. 

DAVID O. SMITH, 
£y his Attorney, Robert S. Jackson. 

Certificate of the Party PtjRCHASiNG,— The amount 
and considerations named in the foregoing Deed or Assign- 
ment are correctly stated, and the same has been paid and 
delivered in compliance with the conditions therein named, 
and the receipt- of a duplicate copy thereof is acknowl- 
edged, and said Right, as therein conveyed, is hereby 
accepted, (d) 

Thomas Jones. 
Witnesses : 

John C. Morris, 

WiiiLiAM Scott. 

Note.— When a sale or grant is executed on this blank 
by the Patent Owner, the ''Special Notice" maybe can- 
celled, as unnecessary. 

In recording at the Patent Office, the Deed proper should 
be recorded first, and the ''Special Notice" just after. 



49 

SPECIAL NOTICE —The validity of all sales or grants 
of Rights made by an Agent or Attorney Is conditioned 
upon the party purchasing receiving two co2nes in duplicate 
of the deed made on the forms or transfer blanks having 
this ''special notice" printed thereon in red ink:— each copy 
tnvst show the exact amount and specify in full the consideration 
paid, and both of said copies must be duly signed by the 
Agent or Attorney, and the t>vo copies delivered to the 
purchaser. 

The party purchasing from an Agent or Attorney must 
sign the certificate printed hereon, thereby guaranteeing 
a compliance with the conditions herein named, and imme- 
diately enclose one of said copies in an envelope addressed to 
DAVID O. SMITH, Elmira, Illinois, and then have the 
same ^'•registered'' by the Postmaster, taking his receipt 
therefor, upon properly doing which, his or their title to 
the Right becomes valid and complete. 

Any deviation from these conditions will invalidate 
sales or grants made by an Agent or Attorney, and the 
same may be annulled and revoked, at my option, within 
thirty days from my receipt of notice thereof, by a written revo- 
cation, first recorded in the Patent Ofiice, and then mailed 
and "registered" to the address of the said party pur- 
chasing, {e) 

DAVID O, SMITH, Owner of Patent. 



The letters in parenthesis^ near the left hand margin of the 
following Explanation refers to points in the form for Patent 
Deed having corresponding letters, 

EXPLANATION OF PATENT DEED. 



This form for Patent Deed is suited for the use of the 
Patent Owner should he desire to make out and sign the 
papers personally, and it is the best blank ever devised for 
the use of an agent acting for the Patent Owner. 

(«) This provision is a restriction on all of the said pat- 
ented articles that may he sold in the territory here as- 
signed, limiting and restricting their lawful use, by the 
persons who may possess them, to and within the boun- 
daries of this particular territory. The assignment of the 
Right being made on this condition, all subsequent pur- 
chasers of territory adjoining this, are protected from an 
invasion of their rights by having power to prevent the 
use, within their territory, of any said patent articles 
bought from others than. themselves. 

(6) This clause is designed to secure the payment of 
money or other consideration for a Right sold by an agent 
IN THE MANNER NAMED in Power of Attorney, and the 
party purchasing is thus required to take notice of those 
conditions. 

(c) This stipulation in the Patent Deed has the effect to 
enforce, legally, the requirements in the Power of Attor- 
ney relating to payment. 

{d) The object of this "Certificate of the Party Purchas- 
ing" is apparent. The purchaser of a Right, who receives 
his Deed of Assignment from an agent, is required to sign 
this certificate as a kind of guarantee to the Patent Owner 
that the deed has been properly made and executed. 

(6) The ''Special Notice," printed in red ink, is arranged 
on the left side of the blank, with lines running lengthwise 
" of the sheet, and at a right angle to the matter proper of 
the Deed. Its position on the sheet is such that it can not 
be detached or removed therefrom without the alteration 
being apparent. It is addressed to parties who may pur- 
chase Rights from an agent, and its object is to secure from 
the purchaser a full and authentic report, to the Patent 
Owner, of every sale made by the Agent. The duplicate 
copy is the desired report. 

The annulment and revocation of a sale made by an 
agent, where the business is done by this method, would 
be an action of extremely rare occurrence ; and a Patent 
Owner would be justified in such a course only in a clear 
case of collusion between a purchaser and the agent. 

For instructions as to the proceedings necessary in case 
of revoking a sale, see (i) in the explanation of Power of 
Attorney. 



A SAFE PLAN TO SELL PATENTS ON CREDIT. 



It is such a frequent thing for parties who are nego- 
tiating to purchase a Patent Right to propose to give 
their promissory notes in payment or part payment 
for the same, and as it is desirable to accept such an 
offer, where a cash payment of sufficient amount is ten- 
dered, it becomes a matter of great importance for 
Inventors to know how such notes may be taken, so 
that, in case they are not paid at maturity, the In- 
ventor will not be the loser. 

The ordinary way of doing this business is to take 
the cash and the note, and give a Deed for the Right, 
bat in case the- notes at maturity are not paid, the 
Patent Right has passed from his hands without his re- 
ceiving much or anything at all for it. 

The Contract plan is a remedy .foi this difficulty. 
The party purchasing acquires no interest in the 
Right, under this contract plan, which he can sell out 
or transfer to others; he receives no Deed, his owner- 
ship is prospective, and the only way he can acquire 
a title and get a Deed is to pay his notes. If he fails 
to pay his notes, the Inventor may proceed to collect 
them by due process of law or not, as he may deem 
advisable ; but in no event can the Inventor be the 
loser by this plan, since he has received a cash pay- 
naent ; and by the terms of the contract tlie purchaser's 



52 

license or authority will lapse and terminate when he 
fails to pay his notes, and the Inventor being fully- 
repossessed of the Right may dispose of it again. 

As to the form of note which it is best to use in 
selling Patents, that is a matter deserving considera- 
tion ; the form here given, which has been used with 
great satisfaction, is believed to be the best that can 
be employed : 

BEST FORM OF NOTE. 

$05. Cincinnati, Ohio, June 1st, 1875. 

ISiinety days after date, for value received, I promise 
to pay to the order of David O. Smith ninety-five dol- 
lars, at the First National Bank, waiving all defense 
or set off. 

John J. Hamilton. 

The peculiar feature of this note is the terminating 
clause, "waiving all defense or set-off." If the drawer 
or signer of such a note i3 pecuniarily responsible, a 
banker or broker would be perfectly safe in discount- 
ing it. 

Where the note is to be signed by two parties use 
this form : 

$95. Cincinnati, Ohio, June 1st, 1875. 

Ninety days after date, for value received, we, or 
either of us, promise to pay to the order of David O 
Smith ninety-five dollars, at the First National Bank, 
waiving all defense or set-off. 

John J. Hamilton, 
Aug. Emekson. 



T lie special x)omts of this form for Contract are made jwomi- 
nent by italics, and foUoivincj eacli is a letter in x>arenthesis that 
refei's to a corresponding Utter near the left nand margin of the 
explanation, on the pages immediately following . 

CONTRACT 

To Sell and Assign the Exclusive Territorial Right of {a) 

UNITED STATES LETTERS PATENT. 

No. 73,513. 



This Agreement, Made the ninth day of June, 1875, be- 
tween David O. Smith, of Elmira, Illinois, party of the first 
part, and Thomas Jones, of New Dover, Ohio, party of the 
second part, witnesseth, that whereas Letters Patent of 
the United States, No. 73,513, for an Improvement in Wash 
Boilers, was granted to the party of the first part, dated 
May 16th, 1868, and whereas the party of the second part is 
desirous of ha\ang- the exclusive right to make, use and 
sell the aforesaid Patent Article within the County of 
Union, in the State of Ohio. Now, therefore, the parties 
have agreed as follows : 

First.— The party of the first part, for and in considera- 
tion of the cash payment named in Article Second hereof, hereby 
licenses (b) and empowers the party of the second part to 
make, use and sell within the aforesaid territory, and no- 
where else, the said Patent Article, restricting the sale 
thereof to purchasers who will use the same only within 
the limits of the aforesaid territory; the said Improve- 
ment to be retailed at a price not less than $3.50 each, (c) 
and the license hereby conferred shall cease on the termi- 
nation of this contract. 

Second.— The party of the second part/or the license herein 
conferred pays (d) unto the party of the first part ninety 
dollars, which shall be applied as a part payment on the 
price named in Article Third hereof for the Bight under 
the Patent aforesaid. 

Third.— The party of the second part agrees to pay to 
the party of the first part three hundred dollars for the 
Exclusive Eight to the territory hereinbefore named, and 
said party of the second part herewith gives three promis- 
sory notes, namely : one for $75, due in thirty days ; one 
for $60, due in sixty days ; and one for $75, due in ninety 
days from date, which, with the payment named in Article 
Second, completes the amount to be paid for said Right. 

Fourth.- When said notes shall have been paid, making 
the full consideration named in Article Third hereof, then 
the party of the first part shall be bound to execute a regu- 
lar Deed granting to the party of the second part, during 
the entire term of said Patent, the exclusive Right to 
make, use and sell the aforesaid Patent Article within the 
territory named— « cojjy of ivhich Deed, shoiving the form and 
terms of the Grant of Right, is printed on this sheet, {e) 



54 

Fifth.— It is agreed that when all of the aforesaid notes 
having- the signature of the said party of the first part en- 
dorsed thereon, have heen paid, and the same are attached 
to the copy of xhis Contract held by the party of the second 
part as evidence of their payment, that then said copy of 
this Contract^ with the aforesaid notes attached^ shall be held 
and taken as equivalent to the regular Deed abo^e named (f) 
granting to the said party of the second part the aforesaid 
Exclusive Right. 

Sixth.— No part of the right, title or interest, to be ac- 
quired by the party of the second part under this Contract, 
is transferable until after the delivery of the aforesaid Deed^ 
(g) or until all of the aforesaid notes have been paid and 
attached hereto, as provided. 

Seventh.— In case the contract executed on this blank 
is made by an agent, the payment and delivery of any con- 
siderations by the party of the second part must be made 
in accordance with the conditions named in his Power of 
Attorney, which said conditions are hereby made a part of 
this Contract; and the signature of said agent must be 
hereunto affixed. 

This Contract shall continue and hold good for ninety 
days (h) from this date, unless sooner terminated by the 
payment of said notes. 

In Witness Whereof, the above named parties have 
hereunto set their hands to two copies of this Contract at 
New Dover, Ohio, the day and year first above written. 
yVitnesses: ) DAVID O. SMITH, ) -pm^u.nr 

John C. Morris, \ By his Attorney^ V wl,JJVri^f 

Wm. Scott, ) ROBERT S. JACKSON, ) ^^^ ^^^^^ ^ 

THOMAS JONES, \ ^IZHfU 

SPECIAL NOTICE.— The validity of all Contracts to 
sell or grant Rights made by an Agent or Attorney is con- 
ditioned upon the party of the second part receiving two 
copies in duplicate of the Contract made on the forms 
having this ''Special Notice" printed thereon in red ink :— 
each copy must show the exact amount and specify in full 
the consideration paid, or to be paid, and both of said 
copies must be duly signed by the Agent or Attorney, and 
the two copies delivered to the party of the second part. 

The party of the second part must immediately enclose 
one of said copies in an envelope addressed to David O. 
Smith, Elmira Hlinois, and then have the same ''regis- 
tered" by the Postmaster, taking his receipt therefor, upon 
properly doing which said -contract becomes valid and 
complete. 

Any deviation from these conditions will invalidate 
such Contract, and the same may be annulled, revoked 
and terminated, at my option, within thirty days from my 
receipt of information thereof, by a written revocation, 
first recorded in the Patent Office, and then mailed and 
"registered" to the address of the said party of the second 
part. DAVID O. SMITH, Owner of Fatent, 



The letters mimrenthesis near the left hand margin of the fol- 
lowing Explanation refers to points in the form for Contract 
having corresponding tetters, 

EXPLANATION OF CONTRACT. 



After the sale of a Rigrht has "been effected Patent Owners 
are frequently subjected to loss hy the purchaser settling- 
for the same either wholly or in part hy giving his promis- 
sory notes, which notes at maturity are not paid. If the 
husiness has been done in the usual manner— by transfer- 
ring- the title to the Right at the time of sale— the Patent 
Right has passed from the owner's hands without his re- 
ceiving any consideration therefor. It may be said that 
the remedy o^ preventive against such losses is to refuse to 
take notes from irresponsible parties ; but who can tell as 
TO the responsibility of a man in a pecuniary view. 

A man who to-day is supposed to be ''good" for thous- 
ands of dollars, may be insolvent next month. 

By this ''Contract plan" it is made to the interest of the 
purchaser to pay his notes, as he can acquire a title to the 
Right only by so doing. If he should not pay the notes, 
the Inventor will at least not be the loser, since he has 
received a cash payment, and will still have the Right to 
dispose of again. 

If the notes are not paid at maturity, and the party is 
responsible, the Patent Owner may proceed to enforce pay- 
ment by due process of law. 

(a) Observe this is a Contract to sell and assign the Terri- 
torial Right, and is to be employed whenever notes are 
taken in payment. 

(b) The Patent Owner licenses the party who purchases 
to "make, use and sell," in consideration of the cash 
payment made, namely, ninety dollars. In every case the 
Inventor should require some cash to be paid at the time of 
signing the Contract. One-half or one-third, or at least 
one-fourth of the whole price of the Right, should be paid 
in cash. 

(c) It is best to name the lowest figures at which the arti- 
cle may be sold pending this Contract Of course when the 
party has acquired a title to the Right, he can then sell 
for any price he may choose. This restriction will prevent 
injury to the sale of the article by the purchaser cutting 
down the price ; and in the event the purchaser fails to pay 
his notes, the Right may be resold, as it will not be mate- 
rially damaged. 

(d) The purchaser makes a cash payment as a return 
OR CONSIDERATION for the liccuse granted him to "make, 
use and sell," during the continuance of this Contract. 
Should he fail to meet his payments, and if the Right reverts 



56 

to the Inventor or Owner, he can not set up a claim for the 
money that has been paid. Should the Inventor at any time 
he willing- to sell a Kig-ht wholly on credit, then the blank 
may be tilled by inserting- one dollar. 

(e) As a "Specimen Copy" of the Deed which the Invent- 
or agrees to execute is printed on the same sheet with the 
Contract, there can arise no dispute afterward as to the 
terms and conditions of the Rig-httobe granted. 

(f) If a party with whom you arQ negotiating for a Kight 
on the Contract plan should ask what security or guarantee 
can be given that, when the notes are paid, the title to the 
Patent Right for the territory will be legally conveyed to 
him ? A satisfactory answer to this objection would be this 
plan of attaching the paid notes to the Contract, and agree- 
ing that it shall then constitute a good and lawful Deed. 

(g) The party purchasing acquires no interest under this 
Contract which he can sell or transfer, and his license 
to " make, use and sell " will lapse and terminate when he 
fails to pay the last maturing note. 

(h) Four months is considered long enough to continue a 
contract of this kind, but it must always run a sufficient 
time to include the date when the last note matures. 

The "Special Notice" in red ink is substantially the 
same as on the blank Deed. See (e) explanation of "Grant 
of Exclusive Territorial Right." 



57 

TO SECURE GOOD AGENTS. 

You must not expect to secure good, successful 
agents unless you are willing and ready to afford tbem 
a good chance. The best and safest plan to employ 
agents is to give them a liberal share of the proceeds 
of sales of Rights for their pay, and let them bear their 
own expenses. Experience proves that it is a mistake 
to suppose capable, trustworthy men will take hold 
of a Patent with that interest which is essential to 
success, unless they have sufficient inducement in the 
shape of good commission and fair prospects. The 
commission proper to be allowed may vary from 25 
to 50 per cent., and on most inventions, when an agent 
pays all his expenses, the latter is about the fair thing. 

You must enter into a written agreement with your 
agent, and stipulate that he shall be governed by your 
printed blanks that limit his authority, and which 
govern and regulate the terms and conditions on 
which he makes sales. By this method you can con- 
trol his operations completely. 

The next step is to endeavor to imbue your agent 
with enthusiasm. In this matter he must take the 
infection from you; as the Inventor you must exhibit 
earnestness and enthusiasm to him ; you must make 
him thoroughly understand the principle of the inven- 
tion; he must learn all about its construction and 
mode of operation ; he should be able, if a piece of 
mechanism, to put it together or take it apart with 
perfect facility, and also to assign a reason for each 
peculiarity in construction, and the advantage which 
such peculiarity gives over all other competing de- 
vices ; in short, he should make a study of your im- 
provement. If he masters all this; if he can become 



58 

somewhat eloquent over its merits, without indulging 
in loose or extravagant statements ; if he is persever- 
ing, possessed of self confidence, without being too 
*'cheeky," and withall if he is a good judge of human 
nature, rest assured you have secured the services of 
a capable maa, and one likely to prove a successful 
and profitable agent. 

WHAT IS NECESSAKY. 

ISTo matter whether the Inventor goes out himself 
to sell rights, or whether he sends an agent, the party 
must have means enough to travel. Whoever may 
go the mode of procedure to find a purchaser is the 
same. It is necessary to have a complete equipment, 
consisting of one or more perfect working models, 
descriptive circulars, show posters, letters patent, or 
a copy thereof duly certified by Commissioner of 
Patents, and which can be obtained by addressing 
said officer at Washington and enclosing $1 50, also 
a number of spare copies of printed Specifications, 
certificates or letters of recommendation, which, how- 
ever, to be worth anything to you, must be authenti- 
cated as genuine by having the post-mark of the place 
where the writer resides stamped on the face of the 
letter, which a friendly postmaster will do ; the elec- 
trotype cuts or engraving, before referred to, will be 
useful. 



FINDING A PURCHASER. 



Wlien these preliminary preparations have been 
made, you will then be ready to lay out a route for 
traveling; it is best to do this before starting, so as to 
determine the towns that it is desirable to stop at. 
Upon reaching a place where you propose to effect a 
sale, leave your baggage, «fec., at the depot, if practica- 
ble to do so with safety, and if this can not be done, 
you may perhaps store it, for the time being, at some 
convenient place near by ; but if neither course is 
practicable, take it at once to a hotel. We deem it 
the best way to leave your traps, as stated, and go 
empty handed to select your stopping place, provided 
always there are several hotels in the town to choose 
from. 

The object of this manoeuvre is to secure quarters 
at the house which, after inspection, you deem is best 
suited to your purposes; and another important 
object is to get accommodations at a reduction from 
the regular price. This may be accomplished in most 
country towns by a little shrewd management. You 
can approach the landlord in a pleasant manner, and 
first ask his price or rate per day or week for board 
and lodging; you can now introduce yourself and 
explain your business ; say to him you travel a great 
deal, that in fact you now live in hotels — as soon as 



60 

you leave one you go to another; that while the 
length of your stay is uncertain, you may remain in 

his town several weeks ; that you are just from , 

where you stopped at the hotel at a slightly reduced 
rate. After presenting the matter in this way, inquire 
if you can be accommodated at a reduction from the 
usual rate. In this way you may secure board at a 
reduction of from twenty-five to seventy five cents 
per day from the regular price. When the price is 
agreed on, it is important, before your baggage is 
brought up, to view the room you are to occupy. It 
should be easy of access from the office or bar-room, 
as a considerable portion of your business in negotia- 
tiDg sales may have to be done with persons in your 
room; thei'c'fore don't accept a room which you 
believe will be inconvenient or unfavorable for your 
purpose. 

DIRECTIONS FOR FURTHER PROCEEDING. 

As soon as you are domiciled in your quarters, 
make friends of the proprietor and his clerks ; take 
advantage of the first opportunity to exhibit to them 
your improvement; endeavor to favorably impress 
them, for if jou enli^t their friendly interest they will 
prove very useful in many ways afterward. 

Post up several of your show cards about the hotel 
premises, in the most conspicuous places; place on 
exhibition in the office or bar-room a model of the 
invention, with some circulars attached to it for dis- 
tribution. In your own room, which must now 
become your place of business, arrange everything 
with an eye to the best eff'tct ; here you must have a 



61 

model, posters, circulars, paper, pen and ink, etc., so 
that when you have a visitor he will be impressed 
with yonr arrangements. 

If a newspaper is printed in the place, advertise. 
It may be well to slxow that you n alize the import- 
ance of the editor by exhibiting in his presence and 
for his special benefit the operation cf yom* machine ; 
by so doing you may secure a good "local" notice. 

From information derived from the landlord you 
may, with circulars in hand, visit every place in the 
town where parties are to be found who would likely 
take an interest in your improvement. Give them a 
circular and invite them to call ; if you can do so it 
is better to make an appointment, naming an hour 
when it will suit each of you to give the matter atten- 
tion ; and it is better for you to call for the party at 
the appointed time, and accompany him to the hotel 
where your model is to be seen; if ycm depend on 
his coming alone, the chances are that you will be 
disappointed, for any trifling circumstance is likely 
to detain hitn if you are not present to remind him 
of the engagement. 

HOW TO OFFER THE PATENT. 

Do not make much of a parade of the improvement 
as a patent, for many business men have a prejudice 
against patents, owing to the number of humbugs 
which have been palmed otF on the unsophisticated ; 
therefore, do not approach the subject of selling Eights 
to a stranger urMl you have ^rs^ secured such person's 
interest in your improvement. Of course you will en- 
gage in conversation with anybody, at any time and 



62 

in any place, on the subject of your improvement, and 
when you are satisfied that your man has really be- 
come interested — which he will do after he finds that 
your invention is a real improvement, the best thing 
of the kind out — you need no longer avoid the subject 
of selling the Patent Right, for by this time his preju- 
dices (if he ever had any) against patents in general 
are forgotten. 

Now is the time to impress hi n — a favorable impres- 
sion made now will enable you to win ; but before you 
can induce a total stranger to buy a Right you must 
gain his confidence. At this stage you must seek a 
private interview with your man; invite him alone 
to your room, where you should have everything 
arranged to your hand ; in your own room you are 
not liable to interruption, nor to be overheard in your 
conversation, and here there will be no idle lookers on 
to make their side lemarks and ask foolish and some- 
times annoying questions. Once in the room with 
your man, if he is really interested, it is plain sailing. 

A VERY IMPORTANT MATTER, 

Inexperienced Inventors are reminded that it is 
often the case that parties are found who would like 
to purchase Ihe Right of a new invention, but who 
are either distrustful of the i epresentations that have 
been made concerning ihe value of the improvement, 
or who lack confidence in the authority of the Agent 
offering to sell the Patent Right. A person may be 
apprehensive on these points, and yet say nothing 
about it, not caring to openly express such objections. 



63 

HOW TO GAIN THE CONFIDENCE OF STRANGERS. 

Put yourself in the buyer's place, as it were, and 
endeavor to anticipate every reasonable objection^ whether 
expressed or not, and satisfy your customer that your- 
self and your Patent are all right. At once propose, 
in a confidential manner, to show how you do your 
business; exhibit the original Letters Patent, or a 
certified copy of the same ; if you are an Agent, show 
your power of at orney, and assist your customer to 
examine these documents, and explain in a satisfac- 
tory manner all questions that may be asked. 

This is at once the most important and the most 
difficult part you will have to perform ; and to make a 
favorable impression your papers must present a neat 
and business like appearance. At this juncture you 
must bring everything to bear in its most favorable 
light. If your printed blanks for making assignments, 
etc., are got up in good st3'le, they will aid you greatly 
in making an impression on your customer. The 
forms for Power of Attorney for Agents, Deed for 
Assignments and Contract, being carefully worded 
and handsomely printe I, will always make the right 
impression — an impression in your favor that can not 
be made on a stranr^er in any other way. Such docu- 
ments as these look like business ; they carry the 
conviction that everything is right, and at once you 
get your customers confidence. If he had doubts 
before, they are now banished ; he feels safe in deal- 
ing with you now, because you have convinced him 
that your business is done methodically and legally. 
He may want to know what guarantee he will have 
that his Right, if he should buy, will be protected 
from invasion by others. This inquiry can be satis- 



64 

factorDj auswered by showing the form for Patent 
Deed or Grant of Right— see ''Explanation of Patent 
Deed" [a) — wherein it will be seen that every assign- 
ment is made on the condition that the patent articles 
sold by the owner of a Right can be lawfully used 
only within the boundaries of said territory. Under 
this clause purchasers of Territorial Rights may 
require every person using one of these patented arti- 
cles to show that it was bought from him, otherwise 
(if not bought of him) he can prevent its further use 
within his territory. 

Too much emphasis can not be laid on the import- 
ance of explaining all these things satisfactorily. To 
effect sales of Rights it is necessary j^rs^ to secure the 
confidence of those to whom you offer the Patent, and 
next to convince them there is money in it. Persons 
are often induced to buy an article under the belief 
that they are getting it below its actual value. It is 
well to bear this fact in mind. 

CLOSING A TRADE. 

When the price and terms of sale have been agreed 
on, if it is an all cash sale, or if the Right is fully paid 
for by property taken in exchange, make a Deed of 
the Right on the form for this purpose. If, however, 
any portion of the pay is taken in notes of the pur- 
chaser, which are not secured by the endorsement of 
one or two persons who are well known to be men of 
property and reliability, then, in the absence of such 
endorsement, do not make a Deed, but enter into a 
contract (as per form of "Contract") to sell and assign 
the Territorial Right when said notes have been paid. 
In ev« ry case the Inventor should require some cash 
to be paid at the time ofdgning the contract. 



NEGOTIA.TIONS OF SALES ARE SOMETIMES 
DEFEATED. 



THE WAY TO PREVENT THIS. 

It is the experience of every Patent salesman that 
in the negotiation of sales, the occurrence of the least 
adverse circamstance before the pipers are finally 
signed, and the consideration handed over, may result 
in defeating a sale at the last moment ; and this result 
may intervene even if the party has verbally agreed 
to buy the Right, and the price and terms are fully 
understood. 

To have some trifling thing take place which upsets 
your trade, just at the very time when you had begun 
to congratulate yourself on a successful issue, is cer- 
tainly most disheartening. 

This result may generally be avoided by the use of 
tact and good management, in this wise : while nego- 
tiating a sale, and after you have a party interested, 
you can begin by intimating to your customer that 
one or two others are very much interested in your 
improvement; as you get along in the negotiation 
you can mention this again, and when at last you 
seem to be at the point of closing a trade, or when 
your customer has indicated that his mind is made up 
to buy, then is the time to clinch the bargain. He may 
say 'all right, I will see you in the morning, and we 
5 



can close the thing up then," — this is the critical time, 
it is just here the sale may fall through. Do not sep- 
arate from him in this way if you can possibly avoid 
it. Do not let him leave you on such a plea as the 
above, for any trifliDg occurrence may cause him to 
change his mind ; therefore, n no is your time to clinch 
the bargain. You can now say that another party is 
considering the matter aud may conclude to buy, and 
under these circumstances you cannot bind yourself 
to hold it open for him until morning, merely having 
his verbal promise to buy, it will not do for you to go 
on any uncertainty ; the other party may come in at 
any time ready to close, and on a mere verbal bargain 
you would not feel justified in missing another oppor- 
tunity to sell. Ask hioi to now make a saiall payment 
on the Right, if it is not more than five dollars, and 
offer to give your receipt for it. If he can comply 
with this, well and good. Should he claiai to be un- 
prepared to do this, you must be guided hy circum- 
stances ; if you are convinced he is anxious to make 
the purchase, you had better suggest that he put up 
his watch, or some other article of value, to indemnify 
you for holding it for him until morning ; if he assents 
to Fuch a proposition, draw up a paper something like 
the following : 

*' This certifies that Thomas Jones, of New Dover, 
Ohio, has agreed to buy the Right of David O. Smith's 
Patent on Wash Boilers for the County of Union, 
State of Ohio, and to pay $300 for the same to-morrow, 
and now delivers to Robert S. Jackson, agent for said 
Smith, his gold watch as security for the fulfilment of 
this agreement, after which the watch is to be returned. 

June 7, 1875. Thomas Jones, 

Robert S. Jackson." 



67 

Make two copies of this paper, both copies to be 
signed by each party, and each party to retain a copy. 

It is not advisable to propose this indemnity or se- 
curity by taking some valuable article, unless Youfed 
confident 0^ hoing able to carry the point. 

If neither cash payment nor article of security can 
be obtained, as a last resort propose that he sign a 
written agreement, setting forth the price to be paid 
f )r the Right, and naming the time when the same 
shall be paid ; this need occupy but half a dozen lines, 
and his signature to it, with one or two persons as 
witnesses, will give you something better than a verbal 
promise to use as a kind of weapon, if he manifests a 
disposition to beat a retreat A written agreement 
of this kind may not enable you to compel a party to 
fulfil his bargain, but the signing of such a document 
would make a man fed under obligation to carry out 
his agreement, and consequently there would be less 
likelihood of his changing his mind before seeing you 
again. By all means endeavor to clinch the bargain 
while your customer is warmed up on the subject. 



JOINT STOCK COMPANIES. 

It is sometimes desirable, instead of selling the 
Patent, to engage in the business of manufacturing 
the patented machine, or the goods which a patented 
machine produces, and if the Inventor has no capital 
he can resort to the plan frequently adopted with suc- 
cess, that of forming a joiat stock company. 

The laws of the several States of the Union provide 
for the incorporation of companies of this kind, and it 
is advisable that an Inventor who wishes to form such 
a company should take the advice at the outset of a 
competent attorney, in order that the incorporation of 
the company proceed in accordance with the laws of 
the State where the business is to be located. 

Suppose the Inventor is willing to transfer his 
Patent to the company, and take his pay in certificates 
of stock, which shall be issued to him, and suppose it 
necessary to have $25,000 cash to carry on the busi- 
ness advantageously. The capital of the company 
may be fixed at $50,000, divided into 500 shares of 
the par value of $100 each. 

Let us suppose the Inventor is to have 125 shares 
of stock, at $100=$12,500, for assigning his Patent. 
Other parties must then be found who will take the 
remaining 375 shares at $100=$37,500; but as it is 
required to raise only $25,000, those who subscribe to 



69 

these shares would have to pay only two-thirds of the 
value of each share, or |66.66| on the $100. 

Should it ever become necessary to have additional 
capital, over and above what the profits of the business 
would supply, these shares then would be liable to an 
assessment of $33 33^ each. 

A business conducted on this p'an by men of the 
right stamp, will generally afford an Inventor good 
returns in the dividends on his slock, and perhaps 
give him permanent employment on a good salary. 

FORM FOR 

ARTICLES OF ASSOCIATION 

OF THE 

Chlcar/o Steam Washer Co^npany 

The subscribers hereto associate themselves as a body 
corporate, under and in pursuance of the provisions 
of the General Laws of the State of Illinois, authoriz- 
ing the formation of joint stock companies, and they 
adopt the following general articles of association and 
agreemc nt : 

First, The name of this corporation shall be the 
"Chicago Steam Washer Company," and its capital 
stock shall be fifty thousand dollars, ($50,000,) to be 
divided into five hundred share3 of one hundred dol- 
lars ($100) each. 

Second, The purpose for which this said corporation 
is to be formed is to manufacture and sell the steam 
wash boilers covered by United States letters patent 
No. 73,513, dated May 16th, 1868, issued to David O, 
Smith, and to buy and sell such real and personal 
estate as may be necessary in the successful prosecu- 
tion of said business. 



70 

Third. The principal place of business of said cor- 
poration shall be at Chicago, Illinois. 

Fourth. Each subscriber hereto agrees to take the 
number of shares in the capital stock of said corpora- 
tion set opposite his name, which shall be paid for by 
installments as may be called for by the directors 
hereafter appointed 

Fifth. It is mutually agreed by and between the 
subscribers to said stock, whose names are signed 
hereto, that said David O. Smith may subscribe hereto 
for one hundred and twenty-five shares, amounting to 
tw^elve thousand five hundred dollars, ($12,500,) and 
that when said letters patent are fully assigned to said 
corporation, said Smith and his legal representatives 
shall be exempt from any further liability on account 
thereof, and that this allowance shall be payment in 
full for said letters pateat, and the invention covered 
thereby, which shall thenceforward be the exclusive 
property of said corporation 

Chicago, Illinois, July 1st, 1875. 

Names. No. of Shares. Par Value, 

David O. Smith. . . . 125 $12,500 

Harvey T. Johnson 100 10,000 

Lewis C. Clark. 75 , 7,500 

Note. — The shares must all be subscribed for, and 
a certain percentage paid up in cash, (which varies in 
amount in the different States,) a meeting of the stock- 
holders then follows, at which an organization is 
effected by electing President and Directors. Tlie 
above Articles of Association, together with a certifi- 
cate setting forth the names of the officers elected to 
serve for the first year, should then be duly recorded 
as provided by law. 



INTRODUCING NEW INVENTIONS. 



SMALL ARTICLES. 

Many newly invented articles are now annually 
introduced to the publi(". through the medium of can- 
vassers or special selling agents, who go from house 
to house exhibiting the article, and explaining its 
utility, and selling as they go. This mode of intro- 
ducing the sale of a new article has advantages not 
possessed by the regular channels of trade. The regu- 
lar trade channels for selling merchandise is for the 
manufacturer to sell to the wholesale merchant, who 
in turn supplies the retail dealers and country store- 
keepers, they selling to the people, who are the users 
and consumers The manner in which the majority 
of dealers do their business, as respects new articles, 
renders it unlikely that anything which requires expla- 
nation will meet with a quick success if placed on sale 
with them. Most dealers do not like to talk over an 
article very long; in the first place they often have a 
large variety of articles in their stock, and partly from 
this circumstance do not take special interest in acew 
article, and in fact it is frequently the case they do 
not even fairly understand the use and advantage of 
an article ; of course, if such be the case, they can not 
properly show and explain it to their customers, and 
the article, in consequence, does not receive a fair 



72 

chance. But whether a storekeeper understands 
it well enough to exhibit it properly or not, he really 
has not the time to give it much attention ; he treats 
it the same as he does other new goods, places it in a 
conspicuous place in his store, and lets it take its 
chances. Customers who come in are waited upon, 
shown whatever they ask for, but the storekeeper 
rarely takes the trouble to call the customer's atten- 
tion to the new article. The result is that these new 
articles frequently remain on hand, and the dealer 
soon begins to regard them as unsalable, and finally 
becoming anxious to get his money out of them, he 
reduces the price, instructs his clerks to work them 
off, and very soon he is sold out of them ; hut he dorCt 
want to lay in any more. Meanwhile, some other mer- 
chant in the place has met with better success in sell- 
ing them, has formed a better opinion of the article, 
and is in a fair way to sell. a good many ; just about 
this time he learns that his competitor in business 
has been underselling him, and perhaps some of his 
customers think he has been selling them too high. 
Of course this is discouraging to a dealer; it will not 
pay him to sell the article at the reduced price his 
competitor has fixed, and therefore he takes no further 
interest in it. The consequence is, the sale of the 
article in that town has been ruined, so far as the 
storekeepers are concerned. 

This is no uncommon experience ; many new arti- 
cles of real usefulness have in this way struggled 
along, as it were, through years, meeting with small 
sales, and cousequent light profits to the Inventor 

For many, small articles the plan of selling at first 
through agents, canvassers and peddlers, is to be pre- 



73 

ferred,at least until the article has become pretty well 
known, when it may be supplied to merchants with- 
out encountering the difficulties above mentioned. 

In most every principal city of the Union may now 
be found parties who make a specialty of introducing 
and selling newly-patented articles, small wares and 
novelties. They keep on hand a stock of these goods, 
and supply their sub-agencies and canvassers, who ped- 
dle the goods direct to the houses and stores of the small 
towns and country villages. Some of these novelty 
dealers in the large cities carry on quite an extensive 
business of this kind, and an Inventor who will sup- 
ply these parties may, through their agency, lay the 
foundation for a large sale for their article. 



JOINT OWNERSHrP OF PATENTS. 



UKDIVIDED INTERESTS. 

So many patents are held and owned jointly by two 
or more persons, that it is an important matter to all 
persons thus interested to rightly understand the 
nature of the ownership each person has in the joint 
property. 

In the case of a Patent granted to two or more joint 
Inventors, or where an Inventor assigns an undivided 
interest in his Pateot to others, the nature of such 
joint ownership may seem plain enough, but it is evi- 
dent a good deal of misconception exists among In- 
ventors as to the real scope of the relation that joint 
owners bear to each other. 

The ordinary relation of co-partner as understood 
at common law, and as exemplified in the case of two 
parties trading together as a firm, does not follow as 
a result of the connection of two or more persons 
owning undivided interests in a Patent. 

It has never been judicially asserted that the several 
part owners of a Patent were liable in law, to contri- 
bute in the proportion of their respective ownership, 
to make good a loss sustained by an unfortunate ope- 
ration of one part owner with his Patent privilege. 



75 

According to the law of Partnership, all the co-part- 
ners are liable, and each must bear his share of any 
loss incurred by the action of one partner in the usual 
course of business. But such is not the law of Co- 
Ownership of Patents. 

THE LAW ON THE SUBJECT. 

When an Tnyentor assigns an undivided interest in 
his Patent — that is, as it were, takes a partner, giving 
him a fourth or a half interest, as the case may be, he by 
such assignment divests himself of the exclusive right 
and privilege he before possessed as sale owner; and 
also he confers on this assignee — now become a part 
owner — the same equally full rights and privileges 
which the Patent granted to him before alone, and 
thenceforward the rights and privileges of the Patent 
are to be held, enjoyed and exercised in common by the 
two parties; not that each part owner shall hitve an 
equal share in the profits, or a share in proportion to 
his ownership, but that either one may freely exercise 
all the rights and privileges secured by the Patent ; it 
is common property, to be used by both or hy either 
one without liability to share his gains, or to account 
therefor to the other part owner, because in law one 
part owner of an undivided Patent privilege has as 
good a right to make, use and sell, and license or per- 
mit outside parties to make, use and sell the thing 
patente 1 as the other ; the right of the several part 
owners to do this rests on the joint ownership of the 
Patent privilege common to each one; neither part 
owner can enjoin or prevent the other from making, 
using and selling the thing patented, because the exer- 



76 

cise of these rights and privileges by one is no invasion 
or infringement upon the rights of the other. 

This is the law so far as concerns the exercise by one 
part owner of the rights and privileges bestowed by 
the Patent. In regard to the disposal or transfer of 
the title to those rights, that is to the Patent itself, the 
law is clear and well settled ; a part owner can sell 
and assign only Ms own share of the right, title and 
interest to the Patent, and no more; that is if he owns 
a half interest he can soil only his own undivided one- 
half, he cannot legally assign or transfer any portion 
of the territory. 

It is unnecessary to enlarge upon the importance of 
so gaarding the common property, that the interest 
of each joint owner may not become impaired by the 
business entanglemeots or unfair acts of the other. 

Several plans for averting such disastrous results 
may be resorted to. One plan is to assign the whole 
interest in the Patent to a third party, in trast for the 
several owners; the trustee to be empowered and 
directed to administer the Patent for the benefit and 
joint account of the several part owners, according to 
the respective interest of each. While this plan may 
be practicable, in some cases where a Patent has be- 
come productive, it would not do where the invention 
is undeveloped or not yet introduced. 

A better plan is for the joint owners to enter into a 
contract regulating the manner of using the Patent 
■Rights and privileges. Such a contract would give 
to each part owner a right of action at law against 
the other, and would prevent one from monopolizing 
an undue share of the business or the profits. 

Where a sole Patentee is about to sell or assign an 



77 

undivided interest in his Patent, a restriction or limit- 
ing clause may be embodied in the deed of assignment, 
stating how the rights and privileges under the Patent 
shall be exercised, and requiring each part owner to 
account to the other. A form of deed with such a 
restriction is here given. 

FORM FOU ASSIGNMENT 

of an undivided interest, with restriction. 

In consideration of one dollar, to me paid by Benja- 
min Thomas, of Elmira, Illinois, I do hereby sell and 
assign to the said Benjamin Thomis one undivided 
half of all my right, title and interest in and to the 
letters patent of the United States, No. 73,513, dated 
May 16tii, 1868, for an Improvement in Wash Boilers ; 
the same to be held and enjoyed by the said Benjamin 
Thomas to the full end of the term for which said 
letters patent are granted. 

This assignment is based and conditioned upon an 
agreement made this day between said Thomas 
and myself, the object and purpose of which is to de- 
fine the manner in which the rights and privileges of 
this Patent shall be exercised by the owners thereof, 
and the several provisions of said agreement are hereby 
made and shall be taken as a part of this assignment. 

Witness my hand, this 9th diy of June, 1875. 

David O. Smitft. 

The agreement following this paragraph is the one 
referred to in the form of assignment last given. This 
plan of agreement, it will be seen, is suited to any case 
where the several owners each desire to participate 



78 

more or less actively in the introduction of the article 
or the patented invention. 

The Power of Attorney stipulated in the second 
article, to be given by each party to the other, is de- 
signed to be in the same form as the one heretofore 
given in this book ; by the use of this form full pro- 
vision is made that each party receives his rightful 
share of the proceeds of any sales of territorial or shop 
Rights made by the other party. Thus, by this plan, 
either one of the two owners are fully empowered to 
negotiate and conclude sales of Rights, and at the same 
time each one is fully protected from any unfair acts 
of the other. 

FORM OF AGREEMENT 

betw^een joint owners of a Patent. 

This agreement, made the 9th day of June, 1875, 
between David 0. Smith, of the one part, and Benja- 
min Thomas, of the other part, both of Elmira, Illi- 
nois, witnesseth : that whereas Letters Patent of the 
United States, No. 73,518, for an Improvement in 
Wash Boilers, was granted to David O. Smith, dated 
May 16th, 1868, and whereas an undivided one-half 
interest in said Patent is about to be assigned to 
said Benjamin Thomas, and whereas said parties are 
desirous of arranging between themselves, for their 
mutual protection and advantage, the terms and con- 
ditions upon which they shall each exercise, use and 
enjoy the rights and privileges secured to them by 
said Patent. Now, therefore, the said parties have 
agreed to and with each other as follows : 

First, The parties hereto are each to give without 



79 

charge as much of his time and attention as he reason- 
ably can to promote their interests as joint owners of 
said Patent. 

Second. That each party hereto shall and does 
herewith give to the other his power of attorney, irre- 
vocable, each granting to the other authority to sign 
his name to any assignment, grant or license to be 
made under said Patent on the conditions therein 
named. (Note. — Instead of this Article see Article 
2d, at the end of this form. ) 

Third. Each of the parties hereto shall be entitled 
to and shall receive one-half of all the revenues, 
receipts or profits arising from this Patent, except in 
those cases where a difi'erent provision is made in 
these articles o' agreement. 

Fourth. Should sales of territorial Rights or li- 
censes be negotiated or efi'ected by either party hereto, 
at his own cost and expense, and unaided by the other 
party, then in such cases the division of the proceeds 
between the parties shall be sixty (60) per cent, of the 
gross amount to the one who made or effected the 
sale or license, and forty (40) per cent to the other. 

Fifth. In the event of any license being granted 
on the royalty plan, it shall be plainly stipulated 
therein that the portion or share of royalty fees due 
to each of the parties hereto shall be paid by the 
licensed party direct to each one, his heirs or assign?, 
without the assent, intervention or control of the 
other party ; and a neglect, failure or refusal on the 
part of the licensed party so to pay to either of the 
parties hereto the share of royalty fees due him, shall 
be cause for either party hereto to cancel and annul 



80 

such license ; and all licenses granted on -the royalty- 
plan shall contain a reservation empowering either 
part owner to cancel, annul and revoke the same for 
such cause. 

Sixth. Neither party hereto shall make or sell to 
others to be used in the United States the article which 
constitutes the subject matter of said Patent, without 
rendering an account and paying over monthly to the 

other party hereto the sum of $ for each and 

every {d"zen or hundred articles, as may be^) that are 
thus made and sold. Such accounts, if any, to be 
made and settled between the parties hereto on or 
before the tenth day of each month. 

Seventh. Neither of the parties hereto will sell, 
assign, or otherwise dispose of the whole or any part 
of his own interest in said Patent, without first obtain- 
ing the written consent of the other party, and if, on 
application, such consent is refused, then the parties, 
(if either party demands it,) shall proceed to make a 
fair and equal division of the territory; and if no 
other plan for effecting the same can be agreed on, it 
shall be done by each party selecting alternately a 
State, the first choice to be determined by casting lot ; 
the divided territory to be then duly assigaed. 

Eighth. This agreement shall not be construed to 
imply the existence of a co-partnership, and neither 
party hereto shall be liable fjr any debts, obligations 
or losses contracted or incurred by the other party. 

Ninth. The parties hereto agree, each with the 
other, his heirs and assigns, to comply with all the 
terms and conditions herein named, and also those 
named in their respective powers of attorney herein 
referred to. 



81 

In witness whereof the above named parties 
have hereto set their hands to two copies of this 
agreement the day and year first above written. 

DAYID O. SMITH, 
Witness : BENJAMIN THOMAS. 

Chas. a. Wilson, 

Edw. B. Dean. 

Note. — Tlii% agreement should 'be recorded at the Patent 
Office at once. 

Article 2d. (To be used instead of the Article 
Second in the above form, if the parties do not wish 
to give each other authority.) 

Neither of the parties hereto shall have power to 
make any sale of Rights, nor grant licenses ia any way 
to others to make, use or sell under said Patent, without 
the consent of the other party ; and the signature of 
both parties hereto shall be essential to the validity of 
all assignments, grants or licenses. 

The same agreement precisely, excepting the neces- 
sary change of phraseology in the preamble, is suited 
to two or more joint Inventors, and in view of its 
importance the subject should be well considered by 
Patentees thus situated. 



PRIORITY OF INVENTION. 



As soon as your ideas of an improvement have taken 
definite shape and form, make a sketch showing the 
same on paper, and if satisfied of its practicability, 
and that it will serve the desired purpose, you should 
then make more careful drawings of it, showing plainly 
the various parts in detail. 

Having done this to your satisfaction, you should 
now proceed to have a model made, and at once apply 
for a Patent. But if for any reason you are not ready 
to file an application for a Patent, then you should 
take the necessary steps to enable you to establish the 
date of your invention. One plan to this end is to 
take the drawings you have made, and call on two or 
three of your most trustworthy friends or acquaint- 
ances, and let them examine the drawings until they 
fully understand them. 

Upon a portion of the same sheet on which the 
drawings are made, write a certificate something like 
the following: 

Elmira, Illinois, March 10, 1868. 

This is to certify that we have carefully examined 
the drawings on this sheet of an Improvement in 
Wash Boilers, and that the same have been explained 
to us this day by Mr. David O. Smith, who claims it 
as his invention. Wm. R. Matthews, 

Joseph B. Williams, 
John Richardson. 



83 

It often happens that an Inventor is called on, 
either in Court where a Patent trial is pending, or 
before the Commissioner of Patents in a case of "in- 
terference," where a competitor is endeavoring to 
obtain a Patent for a similar thing, to show the date 
of his invention. Every Inventor should be able, 
therefore, by some reliable evidence, to show this 
date, as the validity of his Patent may depend on his 
doing so. 

LAW OF PRIORITY. 

" He is the prior Inventor, and is entitled to the 
Patent for an invention, who first embodies it in a 
complete, practical, working utensil, and exhibits it 
to the public, though another afterward reduces it to 
practice, and applies for a Patent before him.'* 

Off. Gazette, Yol. 3, 348, Rice vs. Winchester. 



AGENTS FOR THE SALE OF PATENTS- 



A CAUTION. 

A number of parties styling themselves *' Patent 
Brokers," or "Agents for the sale of Patent Ri^ts," 
hailing from Boston, New York city, Philadelphia, 
Vicksburg, Miss., and other places, send out their cir- 
culars to Inventors, claiming to possess "superior 
facilities " for selling Patents. 

We took pains to investigate the manner in which 
these "Agents" conduct their business, our object in 
doing so was to learn what their facilities were, and 
to select one to sell our Patents. We soon found that 
their opportunities for finding purchasers was no bet- 
ter than our own, and in fact that the chances to sell 
our Patents were greater if we undertook the work 
ourselves. 

Many of these Patent Brokers have absolutely no 
facilities whatever; some of them publish "Patent 
Right Papers," which are issued monthly, apparently 
to subscribers at $1.00 per annum, but in fact their 
circulation is almost wholly gratuitous, that is the 
papers are given away — distributed like handbills. 

These papers are generally filled with advertise- 
ments of inventions for sale, but such advertising gives 
an invention but very little publicity— by no means 



85 

an amount of publicity commensurate with the charge 
of from ten to fifty dollars, that is usually exacted by 
these parties in advance therefor. 

These professional *' Patent Brokers " will tell you 
" if you would make your invention sell, you must 
advertise it," — "you should put yourself in communi- 
cation with capitalists, and others who are looking out 
for inventions of a meritorious character," etc., etc., 
which is to be accomplished, they say, by advertising 
in their wonderful paper— ^^a^ is given away and read, 
hy nobody. 

Men with means to buy are not found reading such 
papers, and do not so easily catch at new inventions. 

These Patent Agenis also state that they "rely 
largely upon their personal acquaintance among 
Backers and Capitalists," which, they claim, is a great 
advantage. Now the fact is, such persons rarely in- 
vest in Patents; generally. Patent Rights are pur- 
chased by enterprising men of moderate means, or 
woll established manufacturers. 

It is the almost universal experience that Patents 
are not sold in the way and by the means these 
"Brokers" set forth — not one Patent in a hundred is 
thus sold. Hence we are forced to conclude that the 
pretensions of most of these Patent Brokers are mere 
shams, with no foundation. We cannot perceive 
wherein such persons have advantages over the 
Patentee. 

They are frequently ready to undertake the sale of 
any Patent merely on receivirg a copy of the specifi- 
cations and drawings, and the advance fee "to pay for 
advertising," — many of them being willing to dispense 
with a model altogether. No man can sell a Patent 



86 

without a perfect model ; and this is not all— after he 
has the model, he must thoroughly understand its 
construction and mode of operation, and all its advan- 
tages; he must be earnest and enthusiastic when 
exhibiting it. All this, we undertake to say, is more 
than the so-called *Tatent Broker" is qualified to per- 
form. We warn Inventors not to pay any money to 
a professional Patent Broker. 



ALL ABOUT LICENSES. 

The law is well settled that Liventors are not re- 
quired to take out a license anywhere within the 
limits of the United States, to sell Rights under his 
Patent. 

STATE LAWS AFFECTING PATENTS. 

All State laws designed to regulate the sale of Patent 
Rights are unconstitutional, and therefore null and 
void The Constitution of the United States (article 
1st, section 8,) confers on Congress the power to pass 
laws regulating Copyrights and Patents, just the same 
as it gives to Congress the power to make laws regu- 
lating the postal affairs 

It is well understood that no State has any right or 
power to interfere with the mails or postoffice matters, 
because these are National afiairs, having their origin 
with the General Government. Now United States 
Patents are precisely to the same extent a National 
matter also, subject only, like postal matters, to the 
laws and regulations of the General Government. It 
must be clear, then, to the most ordinary compre- 
hension, that those States which have passed laws 
attempting to regulate the sale of Patents have done 
what they had no shadow of right to do, and conse- 



88 

quently all such laws are of no force or effect what- 
ever. Fortunately there are several judicial decisions 
on this point that determine the matter conclusively. 

DECISIONS. 

Circuit Court of tJie United States^ District of Iridiana, 

Before the Hon. David Davis, one of the Judges of 
said Court, May 30, 1870. Ca%e : Major J. Robinson — 
Petition for writ of habeas corpus. 

The facts in this case were as follows: Robinson 
was the traveling agent of the owners of a *Patent 
granted to Goodyear and Cummings, and was selling 
county Rights under said Patent On the 23d of May, 
1870, Robinson offered to sell the Right of Grant 
county to Harrison H. La Fever, a dentist, for $100, 
which La Fever agreed to pay. Before the sale was 
completed the district attorney of the county insti- 
tuted proceedings against Robinson, under the pro- 
visions of a State law, (3 Ind. Stat., 364,) which took 
effect April 23, 1869. Robinson was charged with 
not complying with the terms of the law, (selling 
Rights without a license,) and was committed to the 
county jail; thereupon his counsel petitioned the 
United States Court at Indianapolis for a writ of 
habeas corpus. 

Judge Davis decided that property in inventions 
exists by virtue of the laws of Congress, and no State 
has a right to interfere with its enjoyment. If the 
Patentee complies with the laws of Congress on the 
subject, he has a right to go into the open market, any- 
where within the United States, and sell his property. 
If this were not so, it is easy to see that a State could 



89 

impose terms which would result in a prohibilion of 
the sale of this species of property within its borders, 
and in this way nullify the laws of Congress. It is 
clear this kind of legislation is unauthorized, for it 
throws burthens on the owners of this kind of pro- 
perty which Congress has not seen fit to impose on 
them. It attempts to punish a Patentee for doing 
with his property what the National Legislature has 
authorized him to do, and is therefore void. 
Robinson is ordered to be discharged. 

Another decision is given, because in the case de- 
cided the question was as to the constitutional validity 
of the State law, requiring notes given for a Patent 
Right to have the words " Given for a Patent Right *^ 
written or printed on the face of the obligation. 

Huntington Circuit Court — State of Indiana. 

Helm m. The First National Bank of Huntington. 

Decision. 

Buskirk, J. — This is an appeal from a judgment of 
the Court below, rendered on a promissory note to 
which Helm, who was defendant below, pleaded in 
substance that his said note, the subject of this suit, 
was given for a Patent Right, and that said note was 
invalid and void by reason of not having the words 
" Given for a Patent Right" inserted thereon, as re- 
quired by a statute of the State. 8d Ind. Stat., 364. 

The second section of the Act referred to provides 
that the words named shall be inserted in the body of 
the obligation. The third section provides a penalty, 
to which any person shall be subject who takes an 



90 

obligation for a Patent Right without complying with 
this requirement. 

If the Legislature of this State possessed the consti- 
tutional power to enact the law in question, there can 
be no doubt that a note taken in violation of its pro- 
visions would be illegal and void. 

The eischth section of the first article of the Consti- 
tution of the United States confers on Congress the 
power " to promote the progress of science and useful 
arts by securing for limited times to authors and In- 
ventors the exclusive right to their respective writings 
and discoveries." 

It is insisted by counsel for appellee (the Bank) 
that the above grant of powers confers upon the 
National Government the exclusive power to legis- 
late on the subject of Patents, and that consequently 
the Legislature of this State possesses no power to 
legislate on the subject. 

The Federal Government has, continuously, from 
the adoption of the Constitution down to the present 
time, legislated on the subject of Patents and Patent 
Rights. Such legislation has covered the entire ground ; 
for it has not only regulated the manner in which a 
Patent may be obtained from the General Govern- 
ment, but it has prescribed the manner in which such 
Right may be sold and conveyed, and has imposed 
penalties for the infringement thereof. * * * * 
We are of the opinion that the Legislature of Indiana 
possessed no power to pass the statute under conside- 
ration, and it must, therefore, be held unconstitutional 
and void. 

The judgment is affirmed, with costs. 



91 

There are other decisions of a similar character to 
the above, but these are enough to set the seal of con- 
demnation on all State laws which attempt to regulate 
the sale of Patents. 



VALUABLE INFORMATION FOR PATENT 
OWNERS. 



PATENT LAWS AND DECISIONS. 

Injunctions. 

"An injunction against infringing a Patent will be 
granted only when the Patentee shows either that he 
has recovered a judgment on it in a suit, or that he 
has used and enjoyed his Right under it so long as to 
warrant the presumption that the public have acqui- 
esced in it." Brown m. Hinkley & Cole, Vol. 3, 384. 

"Doubts being entertained whether a Patent was 
not invalid for want of novelty in the invention, a 
preliminary injunction was refused." Fales & Chip- 
man m. Wentworth, Vol. 1, 58. 

Infringement 

*' Unless every element embraced in a combination 
is used, or some equivalent for it, a Patent for it is not 
infringed." Brown m, Hinkley & Cole, Vol. 3, 384. 

" If the defendant has incorporated the devices cov- 
ered by the plaintiff's Patent into his machine, he is 
liable as an infringer, although it contains other dif- 
ferent features." Buerk vs, Valentine, Vol. 2, 295. 



93 

"A device that performs all the functions of one 
that is patented substantially in the same way, and 
by the same means, is not the less an equivalent (in- 
fringement) of it because it performs some of those 
functions better, or performs others in addition to 
them." Wheeler vs. The Clipper Mower and R. Co., 
Vol. 2,442. 

" It is no infringement to use those elements of a 
patented combination, in which the Patentee has no 
exclusive property, in combination with other mecha- 
nisms." * * * Dane et al m. Chicago Manuf. Co., 
Vol. 2, 680. 

Damages, 

" In an action for Infringing a Patent, the damages 
are not to be estimated according to what the defend- 
ant has made or might have made, but according to 
what the plaintiff has lost." McComb et al. vs. Brodie, 
Vol. 2, 117. 

" If the owner of a Patent has an established fee for 
a license to work under it, that constitutes the proper 
measure of damages to be recovered by him for in- 
fringing it." Emerson et al. vs. Simms et al.. Vol. 3, 
293. 

" If the Patentee is engaged in manufacturing the 
patented article for sale, his damages will be manufac- 
turer's profits." Westlake vs. Carter, Vol. 4, 636. 

Employing Workman to Assist. 

"An Inventor may avail himself of the knowledge 
and skill of experts (or artisans) in reducing his im- 
provement to practice without jeoparding his right 
to it." Gilbert vs. Clark et al., Vol 5, 428. 



94 

PATENT OFFICE RULES AND REGULATIONS. 

TaI)U of Official Fees, 

On filiDg every application for a design, for three 

years and six months. |10 00 

On filing every application for a design, for seven 

years 15 00 

On filing every application for a design, for four- 
teen years 30 00 

On filing every caveat 10 00 

On filing every application for a patent 15 00 

On issuing each originahpatent 20 00 

On filing a disclaimer 10 00 

On filing every application for a reissue 30 00 

On filing every application for a division of a 

reissue .. 30 00 

On filing every application for an extension . . 50 00 

On the grant of every extension 50 00 

On filing the first appeal from a primary exam- 
iner to examiners-in-chief. 10 00 

On filing an appeal to the commissioner from 

examiners-in-chief 20 00 

On depositing a trade mark for registration. . . 25 00 
For every copy of a patent or other instrument, 

for every 100 words 10 

For every certified copy of drawing, the cost of 

having it made 

For copies of papers not certified, the cost of 

having them made 

For recording every assignment of 300 words 

or under 1 00 

For recording every assignment, if over 300 and 
not over 1,000 words 2 00 



95 

For recording every assignment, if over 1,000 

words 3 00 

For uncertified copies of specifications and 

drawings of patents issued since July 1, 1871 25 
Twenty copies or more, whether of one or sev- 
eral patents, per copy. 10 

For copies of same issued prior to July 1, 1871, 
the reasonable cost of having them made. 
In ordering copies of any Patent, state plainly In- 
ventor's name, title of invention, and date of Patent. 

Lapsed Applications, 

"Where an application for a Patent has been allowed 
and the final Government fee not paid within the fol- 
lowing six months, the application is forfeited, but 
the Inventor may make a new application, and pay the 
fee therefor within two years of original allowance." 

Kind of Bights that may he sold. 

The Patentee may convey separate Rights under 
his Patent to make or to use or to sell his invention, 
or he may convey territorial or shop Rights, which 
are not exclusive. 

Recording Deeds. 

Every assignment or grant of an exclusive territorial 
Right must be recorded in the Patent Office within 
three months from the execution thereof; otherwise 
it will be void as against any subsequent purchaser 
or mortgagee for a valuable consideration without 
notice; but, if recorded after that time, it will protect 
the assignee or grantee against any such subsequent 



purchaser, whose assignment or grant is not then on 
record. 

How to obtain ths Rules of the Patent Office, 

The Rules and Regulations of the Patent Office, 
comprising a pamphlet of 70 pages, are published for 
gratuitous distribution; any Inventor may obtain a 
copy of the same by writing to the Commissioner of 
Patents, and enclosing a postage stamp. 

No more Extensions, 

Patents issued prior to March 4th, 1861, were 
granted for fourteen years, and the Commissioner 
could extend such Patents for seven years. The origi- 
nal term of such Patents having expired March 4, 
1875, there will be no more extensions^ except allowed 
by special act of Congress. 



CONCERNING THE IMPORTANCE OF GOOD 
BLANKS. 



Every one who has had experience in selling Patent 
Rights understands how important it is to the In- 
ventor or Owner o^ a Patent to have printed blanks 
of the best character. 

The common printed blanks generally employed for 
making assignments and power of attorney for agents 
to sell, should not be used ; they are really unsafe for 
Patent owners, for they contain no proper restricting 
clauses. 

If the Inventor gives his personal attention to 
making assignments, licenses, &c., he cannot be too 
careful ; but when he delegates to an agent the author- 
ity to execute these papers, it becomes a matter of the 
highest importance that his blanks should be care- 
fully worded and drawn up in compliance with the 
latest judicial decisions. 

Our improved blanks are devised with the view of 
protecting the Inventor, and in many respects are 
different from all others ; they are handsomely printed 
and are certain to make a favorable impression, be- 
cause they have a genuine business appearance. 

The printed explanation, which accompanies every 
" specimen '' set of Blanks, sets forth in detail the ad- 
vantages derived by the various peculiarities of these 



98 

papers. We tazard nothiug in saying that a set of 
these Bis eIss, in the hards of a gccel Patent saleenian, 
will he of great aid to him in effectiug sales of Eights. 
Every Inventor who intends t© sell Territorial Rights 
of his Patent should by all means have these docu- 
ments. 

Our arrangements for supplying Inventors with 
these improved blanks are complete; we keep the 
type standing all the tim.e, and can readily jnake the 
alterations to suit at trifliEg cost. We print them in 
the same style as the specimen set of blanks sent with 
the book, giving Inventor or Ow;ier's name and resi- 
dence, and date and number of Patent, so as to suit 
the sale of any invention. 

We will furnish these papers in sets, or in any way 
that may be desired, at about half the cost incident to 
printing them in any office where the type would 
have to be reset. 

For particulars as to cost of these Blanks, etc., ad- 
dress S. S. Mann & Co., Baltimore, Md. 



